Answer:
d
Explanation:
Answer:
D
Explanation:
Last web page the customer visited a click stream is an events of hyper link clicks that leave a paper trail behind. plus a good tip to always remember is that when something is free you are the product. and data sells
Prepare summary journal entries to record the following transactions for a company in its first month of operations.
a. Raw materials purchased on account, $90,000.
b. Direct materials used in production, $39,500.
c. Indirect materials used in production, $18,000. Paid cash for factory payroll, $60,000.
d. Of this total, $40,000 is for direct labor and $20,000 is for indirect labor.
e, Paid cash for other actual overhead costs, $7,625.
f. Applied overhead at the rate of 125% of direct labor cost.
g. Transferred cost of jobs completed to finished goods, $65,000.
h. Sold jobs on account for $92,800. The jobs had a cost of $65,000.
Answer: The journal has been attached
Explanation:
The summary journal entries to record the following transactions for a company in its first month of operations has been attached.
Note that the work on process Inventory for (f) was calculated as the direct labor of 40000 multiplied by 125%. This will be:
= 40000 × 125%
= 40000 × 1.25
= 50000
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: On average and everything else held constant, it is generally assumed that savers and investors prefer immediate consumption to deferred, or postponed, spending.
Statement 2: Investments providing cash flows that are more likely to equal their expected value are said to exhibit more risk.
Statement 3: The onset of 5% inflation means that your receipt of a $100 interest payment allows you to purchase only $95 worth of goods and services.
Statement 4: The inflation premium used to calculate the nominal interest rate on a five-year security should be equal to the rate of inflation expected in year 5 of the investment.
The true statements are:
a. 1 and 4
b. 2 and 4
c. 1 and 3
d. 2 and 3
Answer: c. 1 and 3
Explanation:
1. Even though Investors and Savers forego their immediate consumption for future consumption, it is generally assumed that both groups actually prefer immediate consumption to deferred consumption.
This is why they are offered a rate of return that compensates them enough to convince them to take deferred consumption over current consumption.
3. When inflation rises, it erodes the value of money such that people are able to buy less goods using the same amount of money as they were able to before.
If you therefore receive a payment of $100 and inflation is 5%, then 5% of the value of that $100 has been eroded which is $5. This means you're only able to buy $95 worth of goods and services.
Kingston Company uses the dollar-value LIFO method of computing inventory. An external price index is used to convert ending inventory to base year. The company began operations on January 1, 2018 with an inventory of $255,000. Year-end inventories at year-end costs and cost indexes for its one inventory pool were as follows.Year, Ended December 31 Ending Inventory at Year-End Costs Cost. Index (Relative to Base Year)2018 $319,360 1.032019 406,560 1.122020 384,770 1.092021 372,750 1.05RequiredCalculate inventory amounts at the end of each year.
Answer:
2018 ending invnetory $ 311,710.00
2019 ending inventory $ 371,004.76
2020 ending inventory $359,804.76
2021 ending invnetory $ 361,904.76
Explanation:
We need to build up the layers
we divide each year by the base to convert into same year dollars
year-end inventory // cost index base year
beg $255,000 1.00
2018 $319,360 1.03 $310,058.25
the layer will be
beginning 255,000 at 1.00 = 255,000
2018 layer $55,058.25 at 1.03 = 56,710
Total ending inventory 311,710
Year 2019:
year-end inventory // cost index base year
2019 406560 1.12 363000
beginning layer 255,000.00 at 1.00 = 255,000
2018 layer 55,058.25 at 1.03 = 56,710
2019 layer 52,941.75 at 1.12 = 59,294.76
total ending inventory: 371.004,76
Year 2020:
year-end inventory // cost index base year
2020 384770 1.09 353000
beginning layer 255,000.00 at 1.00 = 255,000
2018 layer 55,058.25 at 1.03 = 56,710
2019 layer 42,941.75 at 1.12 = 48,094.76
total ending inventory: 359.804,76
explanation: as the inventory decrease we remove form the last layer rather than adding a new paer for hte year 2020.
Year 2021:
year-end inventory // cost index base year
2021 372750 1.05 355000
beginning layer 255,000.00 at 1.00 = 255,000.00
2018 layer 55,058.25 at 1.03 = 56,710.00
2019 layer 42,941.75 at 1.12 = 48,094.76
2021 layer 2,000.00 at 1.05 = 2,100.00
ending inventory $361,904.76
A sports nutrition company created an energy drink which they think improves athletic performance. In one study, weightlifters were randomly assigned to drink either this new sports drink or flavored water (with a similar taste). The study found that those drank the sports drink were able to lift more weight than before, while those who drank the flavored water were only able to lift the same weight as before.
Is it valid for the company to claim that the cause of the first group lifting more weight than before is due to them drinking the new sports drink?
A. No, because this is an observational study which does not address causation.
B. No, because this is neither an experimental nor observational study.
C. No, because the stronger athletes were likely to drink the new sports drink whereas the weaker athletes were likely to drink flavored water.
D. Yes, because this is an experimental study.
Answer:
C.
Explanation:
Based on the study being described it is not a valid claim because the stronger athletes were likely to drink the new sports drink whereas the weaker athletes were likely to drink flavored water. The companies need to sample athletes that are able to consistently lift a maximum of the same amount of weight. Once they have these participants they can then start the experiment. That way they know that the athletes are all on par with each other and if one is able to lift more than the other because they drank the energy drink they can isolate the drink as a cause.
Answer:3.C
Explanation:
Identify which of the arguments for restricting trade that each of the following rebuttals directs against. Rebuttals The Jobs Argument The National-Security Argument The Infant-Industry Argument The Unfair-Competition Argument The Protection-as-a-Bargaining-Chip Argument (A) The gains of the consumers from buying imports at the low price subsidized by foreign governments would exceed the losses of domestic producers. (B) Companies may exaggerate the degree to which their products are essential to national defense in order to obtain protection from foreign competition at the expense of consumers. (C) The country may be forced into deciding between implementing trade restrictions as threatened, which would make the society as a whole worse off, or backing down on its own threat, which would cause it to lose credibility in foreign affairs. (D) Opening up to free trade may impose hardship on some workers in the short run, but it also creates jobs in industries in which the country has a comparative advantage and enables the country as a whole to enjoy a higher standard of living.
Answer:
(A) The gains of the consumers from buying imports at the low price subsidized by foreign governments would exceed the losses of domestic producers.
The Unfair-Competition Argument
(B) Companies may exaggerate the degree to which their products are essential to national defense in order to obtain protection from foreign competition at the expense of consumers.
The Protection-as-a-Bargaining-Chip Argument
(C) The country may be forced into deciding between implementing trade restrictions as threatened, which would make the society as a whole worse off, or backing down on its own threat, which would cause it to lose credibility in foreign affairs.
The Infant-Industry Argument
(D) Opening up to free trade may impose hardship on some workers in the short run, but it also creates jobs in industries in which the country has a comparative advantage and enables the country as a whole to enjoy a higher standard of living.
The Jobs Argument
Explanation:
George consumes two goods, milk and cookies. He has maximized his utility given his income. Milk costs $2 per gallon and he consumes it to the point where the marginal utility he receives from milk is 4. Cookies cost $4 per bag and the relationship between the marginal utility that George gets from eating a bag of cookies and the number of bags he eats per month is as follows:
Bags of Cookies 1 2 3 4 5 6
Marginal Utility 20 16 12 8 4 0
How many bags of cookies does George buy each month?
a. 1.
b. 2.
c. 3.
d. 4.
Answer:
George buys 5 bags of cookies each month
Explanation:
Given
[tex]Milk = \$2[/tex] (per gallon)
[tex]Marginal\ Utility\ (milk) = 4[/tex]
[tex]Cookies = \$4[/tex] (per bag)
Required
Determine the number of bags of cookies he buys
First, we need to determine the marginal utility of cookies
To solve this, we make use of the following formula:
[tex]\frac{MU\ of\ Milk}{Cost\ of\ Milk} = \frac{MU\ of\ Cookies}{Cost\ of\ Cookies}[/tex]
Substitute values for
MU of Milk = 4
Cost of Milk = 2
Cost of Cookies = 4
This gives:
[tex]\frac{4}{2} = \frac{MU\ of\ Cookies}{2}[/tex]
[tex]2 = \frac{MU\ of\ Cookies}{2}[/tex]
[tex]MU\ of\ Cookies = 2 * 2[/tex]
[tex]MU\ of\ Cookies = 4[/tex]
From the given table:
The corresponding bags of cookies for marginal utility of 4 is 5
Hence:
George buys 5 bags
Brooks Foundry in Charleston, South Carolina, uses a predetermined manufacturing overhead rate to allocate overhead to individual jobs based on the machine hours required. At the beginning of the year, the company expected to incur the following:
Manufacturing overhead costs $650,000
Direct labor cost $1,300,000
Machine hours 81,250
At the end of the year, the company had actually incurred:
Direct labor cost $1,190,000
Depreciation on manufacturing plant and equipment $485,000
Property taxes on plant $21,500
Sales salaries $26,000
Delivery drivers' wages $14,500
Plant janitors' wages $11,000
Machine hours 54,500 hours
Requirements:
1. Compute predetermined manufacturing overhead rate.
2. How much manufacturing overhead was allocated to jobs during the year?
3. How much manufacturing overhead was incurred during the year? Is manufacturing overhead underallocated or overallocated at the end of the year? By how much?
4. Were the jobs overcosted or undercosted? By how much?
Answer:
Brooks Foundry
1. Predetermined manufacturing overhead rate
= $8
2. Allocated manufacturing overhead = Overhead rate multiplied by actual machine hours
= $8 * 54,500
= $436,000
3. Manufacturing overhead incurred during the year = $517,500
Manufacturing overhead is underallocated at the end of the year.
The underallocation = $81,500 ($517,500 - 436,000)
4. The jobs were undercosted by $81,500.
Explanation:
a) Data and Calculations:
Estimated costs:
Manufacturing overhead = $650,000
Direct labor cost = $1,300,000
Machine hours = 81,250
Actual costs:
Direct labor cost $1,190,000
Overhead costs:
Depreciation on manufacturing
plant and equipment $485,000
Property taxes on plant $21,500
Plant janitors' wages $11,000
Total actual overhead costs $517,500
Machine hours 54,500 hours
b) Selling Expenses:
Sales salaries $26,000
Delivery drivers' wages $14,500
Total $40,500
c) Computation of the predetermined manufacturing overhead rate:
Predetermined overhead rate = estimated manufacturing overhead costs divided by estimated machine hours
= $650,000/81,250
= $8
As a practicing engineer, you have been assigned by your company to work in a country where bribery is an almost universal practice, and virtually essential to get government permission for construction permits and other items your company needs to do business. Your direct supervisor explains this to you and asks you to deliver a bribe to a local official. Ethically speaking:______.
Answer:
it is wrong to do so
Explanation:
Note that been ethical involves doing what is right even when no one else is doing the same. In this case, the direct supervisor does not see things from an ethical perspective, rather he believes in the wrong principle of "following after the crowd."
Thus, Ethically speaking, if the practicing engineer follows through with his supervisor's request, he would have done the wrong thing.
A organization in which specialists from different parts of the organization are brought together to work on specific projects but still remain part of a line-and-staff structure is referred to as a
Answer:
Matrix organization structure
Explanation:
A matrix organizational structure is a work arrangement in which employees report to two or more supervisors rather than one line manager overseeing every project aspect. The reporting relationships are grid-like, with employees reporting to both product and functional managers. For example, an employee may have a direct manager they report to, plus one or more project managers they operate under.
The matrix organizational structure is useful when sharing skills across departments is necessary to complete a project.
Culture and Ethical Business Practices
The business world is becoming increasingly global due to advances in technology and travel. This means that businesspeople must know how to navigate intercultural ethics, not just the ethics of their particular country. To better prepare for the ethical challenges of a global marketplace, you should broaden your cultural awareness and familiarize yourself with strategies that help you adhere to legal and ethical guidelines.
Read the following passages.
You are an HR representative for a global shipping company. Your supervisor asks you to contribute ideas via e-mail on possible discussion topics for the next HR meeting on intercultural ethics.
What discussion topics could you suggest?
A. Legal requirements, company policies, and conflicting cultural norms.
B. Ways to avoid being caught when participating in unscrupulous business practices abroad
C. Organizational mapping.
During a conference call with the corporate office, you are told by a senior executive that you will be going abroad in the next week to finalize a large account. He informs you that your expense account for this trip will be larger because, in order for the deal to go through, you must pay the top executives $5,000 each.
How do you respond to this information?
A. Accuse the senior executive of global corruption and read him the Sarbanes-Oxley Act of 2002.
B. Clarify the situation, and ask specific questions about the overseas company's cultural and ethical practices. Also, ask what your company policies are regarding intercultural ethics.
C. Suggest that you pay just one executive this time around and save the company money.
Rather than determining whether a culture has good or bad ethics, it is best to look for practical solutions to the cultural challenges of doing global business.
Which of the following suggestions acknowledge different values and respect the need for moral initiative?
A. Refuse alternatives.
B. Avoid reflex judgments.
C. Don't rationalize shady decisions.
D. Embrace transparency.
Answer:
Culture and Ethical Business Practices
1. Discussion topics:
A. Legal requirements, company policies, and conflicting cultural norms.
2. Response to this information:
B. Clarify the situation, and ask specific questions about the overseas company's cultural and ethical practices. Also, ask what your company policies are regarding intercultural ethics.
3. Suggestion that acknowledge different values and respect the need for moral initiative:
D. Embrace transparency.
Explanation:
There are global cultural differences. The country's value system may be difficult to be globally upheld. It is only transparency that will ensure proper navigation of intercultural ethics. By asking questions and soliciting for clarifications, a good balance can be established in order to overcome ethical challenges in the global marketplace.
Which of the following selections effectively use the "you" view.
A. I’m requesting that all of our valued customers complete the customer satisfaction survey.
B. Thank you for your letter regarding your CRB2 home entertainment center.
C. We know you enjoyed your online shopping experience and will want to tell all your friends about it.
D. You are invited to take advantage of our professional development workshops.
Answer:
B. Thank you for your letter regarding your CRB2 home entertainment center. D. You are invited to take advantage of our professional development workshops.Explanation:
The ''you'' view refers to a style of writing where the sender intends to make sure that the focus is on the person receiving the correspondence.
By using the ''you'' view, the receiver becomes the subject of the correspondence such that the text and its contents and are directed at the receiver.
The correct options would be B and D because the options were directed strictly to the receiver and no one else.
Consider the following three stocks:
Stock A is expected to provide a dividend of $11.20 a share forever.
Stock B is expected to pay a dividend of $6.20 next year. Thereafter, dividend growth is expected to be 6.00% a year forever.
Stock C is expected to pay a dividend of $4.80 next year. Thereafter, dividend growth is expected to be 22.00% a year for five years (i.e., years 2 through 6) and zero thereafter.
Required:
If the market capitalization rate for each stock is 10%, which stock is the most valuable?
Answer:
Stock B is most valuable
Explanation:
a. Price of Stock A = $11.20/10% =$11.20/0.1 = $112
b. Price of Stock B = $6.20 / (10%-6%) = $6.20/4% = $6.20/0.04 = $155
C. Price of Stock C = $4.80/1.1 + $4.80*1.22/1.11^2 + $4.80*1.22^2/1.11^3 + $4.80*1.22^3/1.11^4 + $4.80*1.22^4/1.11^5 + ($4.80*1.22^5/10%)/1.1^5
Price of Stock C = $4.36 + $4.75 + $5.22 + $5.74 + $6.31 + $80.55
Price of Stock C = $106.93
Conclusion: Stock B is most valuable
How would a businessperson be most likely to use seed capital?
A. To purchase equipment for a business
B. To hire managers for a business
C. To hire workers for a business
D. To research the feasibility of opening a business
Answer:
c. to hire workers for a business
Explanation:
Company sells a product for per unit. Variable costs are per unit, and fixed costs are per month. The company expects to sell units in . Calculate the contribution margin per unit, in total, and as a ratio.
Answer:
All the numbers are missing, so I looked for similar questions that can be used as an example:
Company sells a product for $15 per unit. Variable costs are $8 per unit, and fixed costs are $350,000 per month. The company expects to sell units 75,000. Calculate the contribution margin per unit, in total, and as a ratio.
contribution margin per unit = sales price - variable cost = $15 - $8 = $7
total contribution margin = contribution margin per unit x total sales = $7 x 75,000 = $525,000
contribution margin ratio = total contribution margin / total sales = $525,000 / ($15 x 75,000) = $525,000 / $1,125,000 = 0.4666 = 46.67%
Johnstone Company is facing several decisions regarding investing and financing activities. Address each decision independently.
a. On June 30, 2021, the Johnstone Company purchased equipment from Genovese Corp. Johnstone agreed to pay Genovese $22,000 on the purchase date and the balance in five annual installments of $5,000 on each June 30 beginning June 30, 2022. Assuming that an interest rate of 11% properly reflects the time value of money in this situation, at what amount should Johnstone value the equipment.
b. Johnstone needs to accumulate sufficient funds to pay a S400,000 debt that comes due on December 31, 2023. The company will accumulate the funds by making five equal annual deposits to an account paying 6% interest compounded annually. Determine the required annual deposit if the first deposit is made on December 31, 2018.
c. On January 1, 2018, Johnstone leased an office building. Terms of the lease require Johnstone to make 20 annual lease payments of $120,000 beginning on January 1, 2018. A 10% interest rate is implicit in the lease agreement. At what amount should Johnstone record the lease liability on January 1, 2018, before any lease payments are made?
Answer:
a. On June 30, 2021, the Johnstone Company purchased equipment from Genovese Corp. Johnstone agreed to pay Genovese $22,000 on the purchase date and the balance in five annual installments of $5,000 on each June 30 beginning June 30, 2022. Assuming that an interest rate of 11% properly reflects the time value of money in this situation, at what amount should Johnstone value the equipment.
we must determine the present value of the annual installments:
PV = $5,000 x 3.6959 (PV annuity factor, 11%, 5 periods) = $18,479.50
Dr Equipment 40,479.50
Dr Discount on notes payable 6,520.50
Cr Cash 22,000
Cr Notes payable 25,000
b. Johnstone needs to accumulate sufficient funds to pay a $400,000 debt that comes due on December 31, 2023. The company will accumulate the funds by making five equal annual deposits to an account paying 6% interest compounded annually. Determine the required annual deposit if the first deposit is made on December 31, 2018.
we should use the future value of an annuity due formula:
FV = annual savings x annuity due factor
annual savings = FV / annuity due factor
FV = $400,000
FV annuity due factor, 6%, 6 periods = 7.39384
annual savings = $400,000 / 7.39384 = $54,099.09
c. On January 1, 2018, Johnstone leased an office building. Terms of the lease require Johnstone to make 20 annual lease payments of $120,000 beginning on January 1, 2018. A 10% interest rate is implicit in the lease agreement. At what amount should Johnstone record the lease liability on January 1, 2018, before any lease payments are made?
we should use the present value of an annuity due formula:
PV = annual lease payment x annuity due factor
annual lease payment = $120,000
PV annuity due factor, 10%, 20 periods = 9.36492
PV = $120,000 x 9.36492 = $1,123,790.40
Dr Right of use asset 1,123,790.40
Cr Lease liability 1,123,790.40
This activity is important because managers face the difficult task of planning, implementing, and evaluating marketing programs once the firm has decided to compete in the global market. As marketing mangers develop the marketing program, they must balance the cost savings of standardization against the benefits of customization.
The goal of this exercise is to demonstrate your understanding of the different types of product and promotion strategies firms utilize as part of their global marketing programs.
Roll over each company name to read the description of the firm's strategy, then drop it onto the correct product and promotion strategy within the graphic.
1. Shiseido
2. Breathe Right
3. Toyota
4. Maybelline
5. Gasoline Producer
A. Product Extension Strategy
B. Product Adaptation Strategy
C. Product Invention Strategy
D. Communication Adaptation Strategy
E. Dual Adaptation Strategy
Answer:
1. Shiseido ⇒ A. Product Extension Strategy : usually carried out for products that are in their maturity phase and the focus is placed on extending the product's life-cycle.
2. Breathe Right ⇒ D. Communication Adaptation Strategy : focuses on changing the content of the communication strategy so that customers are aware that the product or service changed, offers new features, etc.
3. Toyota ⇒ C. Product Invention Strategy : focus placed on developing new products that can be technology-driven, customer-driven or competition-driven.
4. Maybelline ⇒ B. Product Adaptation Strategy : focuses on changing or altering existing products in order to satisfy the needs of different customers on different markets.
5. Gasoline Producer ⇒ E. Dual Adaptation Strategy: focuses on adapting a company's product in order to satisfy different domestic needs, e.g. Gasoline sold in California is not the same as gasoline sold In Texas due to stricter environmental regulations.
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. & c. Identify the events that result in revenue or expense recognition and those which affect the statement of cash flows. In the Statement of Cash Flows column, use OA to designate operating activity, FA for financing activity, IA for investing activity and NA to indicate the element is not affected by the event.
b. Based on your response to Requirement a, determine the amount of net income reported on the 2018 income statement.
d. Based on your response to Requirement c, determine the amount of cash flow from operating activities reported on the 2018 statement of cash flows.
e. What is the before- and after-closing balance in the service revenue account?
f. What is the balance of the retained earnings account that appears on the 2018 balance sheet?
Answer:
a & c. See part a & c of the attached excel file for the table. In the attached excel file, Total revenue = $100,000; and Total expenses = $61,900.
b. The amount of net income reported on the 2018 income statement is $38,100.
d. The amount of cash flow from operating activities reported on the 2018 statement of cash flows is $25,000.
e. Before closing balance in service revenue account = $100,000; and After closing balance = $0.
f. The balance of the retained earnings account that appears on the 2018 balance sheet is $32,200.
Explanation:
a. & c. Identify the events that result in revenue or expense recognition and those which affect the statement of cash flows. In the Statement of Cash Flows column, use OA to designate operating activity, FA for financing activity, IA for investing activity and NA to indicate the element is not affected by the event.
Note: See part a & c of the attached excel file for the table.
From the attached excel file, we have:
Total revenue = $100,000
Total expenses = $61,900
b. Based on your response to Requirement a, determine the amount of net income reported on the 2018 income statement.
Based on part a & c above, we can determine this as follows:
Net income = Total revenue - Total expenses = $100,000 - $61,900 = $38,100
Therefore, the amount of net income reported on the 2018 income statement is $38,100.
d. Based on your response to Requirement c, determine the amount of cash flow from operating activities reported on the 2018 statement of cash flows.
Note: See part d of the attached excel file for the amount of cash flow from operating activities.
From the attached excel file, we have:
Cash flow from operating activity = $25,000
Therefore, the amount of cash flow from operating activities reported on the 2018 statement of cash flows is $25,000.
e. What is the before- and after-closing balance in the service revenue account?
Before closing balance in service revenue account = Services performed on account + Services performed for cash = $81,000 + $19,000 = $100,000
After closing balance = $0
The "after closing balance" is equal to zero because, at the end of a particular period, the balance of the service revenue account turns to $0 when the firm has to close the balance of the service revenue account in the retained earnings.
f. What is the balance of the retained earnings account that appears on the 2018 balance sheet?
Retained earnings = Net income - Cash dividend paid to the stockholders = $38,100 - $5,900 = $32,200
Therefore, the balance of the retained earnings account that appears on the 2018 balance sheet is $32,200.
The YTM on a bond is the interest rate you earn on your investment if interest rates don’t change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY).
Requirement:
1. Suppose that today you buy a bond with an annual coupon rate of 8% for $1,170. The bond has 16 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value of $1,000.
2. Two years from now, the YTM on your bond has declined by 1%, and you decide to sell.
A) What price will your bond sell for?
B) What is the HPY on your investment?
Answer and Explanation:
The computation of each part is to be shown in the attachment. The one statement is of final values and the other one is of formula sheet.
This one applied for all the things which need to be find out
Kindly find the attachment below:
We use the RATE formula for determining the rate of return and the same is to be considered
At January 1, 2021, Café Med leased restaurant equipment from Crescent Corporation under a nine-year lease agreement. The lease agreement specifies annual payments of $29,000 beginning January 1, 2021, the beginning of the lease, and at each December 31 thereafter through 2028. The equipment was acquired recently by Crescent at a cost of $207,000 (its fair value) and was expected to have a useful life of 12 years with no salvage value at the end of its life. (Because the lease term is only 9 years, the asset does have an expected residual value at the end of the lease term of $94,113.) Crescent seeks a 12% return on its lease investments. By this arrangement, the lease is deemed to be a finance lease. (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. Round your intermediate calculations to the nearest whole dollar amount.)
Required:
1. What will be the effect of the lease on Café Med's earnings for the first year (ignore taxes)? (Enter decreases with negative sign.)
2. What will be the balances in the balance sheet accounts related to the lease at the end of the first year for Café Med (ignore taxes)?
Answer:
$11,750
$189,750
Explanation:
1: Calculation for the effect of the lease on Café Med's earnings for the first year
Based on the information given we were told that the lease agreement has annual payments of the amount $29,000 which means that Corporation will recognized a rental revenue of the amount $29,000 each year
Now let Compute for the depreciation to be charged on equipment using this formula
Annual depreciation = Cost of equipment / Useful life
Let plug in the formula
Annual depreciation= $207,000 / 12
Annual depreciation= $17,250
Second step is to Compute for Crescent Effect on earnings using this formula
Crescent Effect on earnings = Rental revenue - Depreciation expense
Let plug in the formula
Crescent Effect on earnings= $29,000 - $17,250
Crescent Effect on earnings= $11,750
2. Calculation for the balances in the balance sheet accounts
Using this formula
Equipment balance at the end of 2021 = Cost - Accumulated depreciation
Let plug in the formula
Equipment balance (net) at the end of 2021= $207, 000 - $17, 250
Equipment balance (net) at the end of 2021= $189,750
Deferred lease revenue will be the Rental amounts that was received in advance on 31. DEC.2021 for 2019 year = $29,000
Two consumers are searching for new hair salons and have very different belief systems and needs that affect the way they search for information. The second step in the consumer decision process, after a consumer recognizes a need, is to search for information about various options that exist to satisfy that need. The length and intensity of the search are based on the degree of perceived risk associated with purchasing the product or service.
Read each statement and match it with the followings.
a. Effortless,
b. Worth the Money,
c. Expensive Service,
d. Salon of Choice
e. Unimportant
f. Tight Budget
g. Could Damage Career
h. All the Same
i. Salon of Convenience
j. Personal Image
Joleen Jones Ginger Petri
1. Performance Risk
2. Financial Risk
3. Psychological Risk
4. Internat vs External
5. Benefits vs Costs
Answer:
Joleen Jones Ginger Petri
1. Performance Risk (Working efficiency)
Could Damage Career
All the same (both will consider the same )
2. Financial Risk (Money concern)
Expensive Service
Tight budget
3. Psychological Risk (Link with perception)
Personal Image
Unimportant
4. Internal vs External Search for Information
Salon of Choice (Easy in selection)
Salon of Convenience
5. Benefits vs Costs (Profit or loss regarding satisfaction)
Worth the Money
Effortless
The following December 31, 2021, fiscal year-end account balance information is available for the Stone Corporation:Cash and cash equivalents $ 6,200Accounts receivable (net) 32,000Inventory 72,000Property, plant, and equipment (net) 180,000Accounts payable 51,000Salaries payable 23,000Paid-in capital 160,000The only asset not listed is short-term investments. The only liabilities not listed are $42,000 notes payable due in two years and related accrued interest of $1,000 due in four months. The current ratio at year-end is 1.5:1.Required:Determine the following at December 31, 2021:1. Total current assets2. Short-term investments3. Retained earnings
Answer:
1.
Total current assets = $112500
2.
Short term investments = $2300
3.
Retained earnings = $15500
Explanation:
1.
The total current assets can be determined using the current ratio provided for 2021. The current ratio is calculated by dividing the value of total current assets by the value of the total current liabilities.
1.5 = Total current assets / (51000 + 23000 + 1000)
1.5 = Total current assets / 75000
1.5 * 75000 = Total current assets
Total current assets = $112500
2.
Short term investments are a part of the current assets. The value of short term investments is,
112500 = 6200 + 32000 + 72000 + Short term investments
112500 = 110200 + Short term investments
112500 - 110200 = Short term investments
Short term investments = $2300
3.
The basic accounting equation states that the total assets is always equal to the value of total liabilities plus total equity.
Total assets = Total Liabilities + Total Equity
(112500 + 180000) = [(51000 + 23000 + 1000) + 42000] + (160000 + Retained earnings)
292500 = 117000 + 160000 + Retained earnings
Retained earnings = 292500 - 277000
Retained earnings = $15500
Each of the following costs pertains to Bailey Dairy Products Company, a dairy processing company. Classify each of the company's costs as a period cost or a product cost. Further classify product costs as either direct material (DM), direct labor (DL), or manufacturing overhead (MOH). (If the cost is a period cost, leave the classification input field empty; do not select a label.) LOADING...(Click the icon to view the costs.) Cost Period Cost or Product Cost DM, DL or MOH
1. Television advertisements for Bailey’s products Period cost MOH
2. Lubricants used in running bottling machines Product cost MOH
3. Research and development related to elimination of antibiotic residues in milk Period cost MOH
4. Gasoline used to operate refrigerated trucks delivering finished dairy products to grocery stores Period cost MOH
5. Company president’s annual bonus Period cost MOH
Answer:
1. Television advertisements for Bailey’s products
PERIOD COST2. Lubricants used in running bottling machines
PRODUCT COST: manufacturing overhead3. Research and development related to elimination of antibiotic residues in milk
PERIOD COST4. Gasoline used to operate refrigerated trucks delivering finished dairy products to grocery stores
PERIOD COST5. Company president’s annual bonus
PERIOD COSTExplanation:
Product costs are all costs that are directly related to the manufacturing process of milk or other dairy products, e.g. workers wages, milk (raw materials).
Period costs are not directly related to the company's manufacturing process and they include sales and administrative costs (S&A), research and development (R&D), delivery costs.
The freight costs incurred for purchasing materials are part of product costs, but the delivery costs are sales expenses (period costs).
A study conducted by Yahoo! revealed that chocolate is the most popular flavor of ice cream in America. Now, Suppose a severe drought in the Midwest causes dairy farmers to reduce the number of milk-producing cattle in their herds by a third. These dairy farmers supply cream that is used to manufacture chocolate ice cream. Indicate the possible effects on demand, supply, or both, as well as the equilibrium price and quantity of chocolate ice cream.
a. The demand curve for chocolate ice cream
a. does not shift
b. shifts to the left
c. shifts to the right
b. The supply curve for chocolate ice cream
a. shifts to the left
b. does not shift
c. shifts to the right
c. The equilibrium price of chocolate ice cream
a. could increase or dereease.
b. decreases.
c. increases
d. The equilibrum quantity of chocolate ice cream
a. decreases
b. increases.
c. could increase or decrease.
Answer:
a. does not shift
b. shifts to the left
c. increases
a. decreases
Explanation:
As a result of the drought affecting the supply of cream, the supply of chocolate would fall. As a result, the supply curve would shift to the left. The demand curve would remain unchanged.
As a result of the leftward shift of the supply curve, the equilibrium price would increase and quantity would fall.
Causwell Company began 2021 with 18,000 units of inventory on hand. The cost of each unit was $5.00. During 2021 an additional 38,000 units were purchased at a single unit cost, and 28,000 units remained on hand at the end of 2021 (28,000 units therefore were sold during 2021). Causwell uses a periodic inventory system. Cost of goods sold for 2021, applying the average cost method, is $166,600. The company is interested in determining what cost of goods sold would have been if the FIFO or LIFO methods were used.
Required:
a. Determine the cost of goods sold for 2018 using the FIFO method. [Hint: Determine the cost per unit of 2018 purchases.]
b. Determine the cost of goods sold for 2018 using the LIFO method. (Do not round intermediate calculations.)
Answer:
158,820
187,800
Explanation:
Which of the following is a piece of good advice regarding business emails? a. Do not place anything in an email you would not want the world to see. b. Use capital letters in order to convey importance. c. Do not sign off your emails with a closing like "Thank you"; it just wastes space. Simply send your contact information. d. Make your request at the end of an email.
Answer:
A. Do not place anything in an e-mail you would not want the world to see.
Explanation:
An e-mail is the short term for electronic mail and it can be defined as a means of communication by providing a medium of sending data (informations) from one user to another over a network. Simply stated, an email allow users with an email address to send messages to another over the internet.
A piece of good advice regarding business emails would be, do not place anything in an e-mail you would not want the world to see because the messages contained in emails are presented bare not encrypted. Therefore, any private message (information) that a user do not want to get into the wrong hands shouldn't be sent in an email.
Assume that you are 30 years old today, and that you are planning on retirement at age 65. You expect your salary to be $42,000 one year from now and you also expect your salary to increase at a rate of 5% per year as long as you work. To save for your retirement, you plan on making annual contributions to a retirement account. Your first contribution will be made on your 31st birthday and will be 8% of this year's salary. Likewise, you expect to deposit 8% of your salary each year until you reach age 65. Assume that the rate of interest is 9%.
Required:
a. The present value (PV) (at age 30) of your retirement savings is ________.
b. A rich donor gives a hospital $1,040,000 one year from today. Each year after that, the hospital will receive a payment 6% larger than the previous payment, with the last payment occurring in ten years' time. What is the present value (PV) of this donation, given that the interest rate is
11%?
c. If the current rate of interest is 8%, then the present value (PV) of an investment that pays $1200 per year and lasts 24 years is closest to ________.
Answer:
The answer to this question can be defined as follows:
In point a, answer is "$61,303".
In point b, answer is " $7,681,257.74".
In point c, answer is "$12,635".
Explanation:
Given value:
In point a:
Year 1 = 0.08(42,000)
= $3,360
Time = 30 years
Rate Of Growth = 5%
Rate Of Interest = 9%
Formula:
Present Value [tex]= \frac{P}{(r - g)}[1 - (\frac{(1 + g)}{(1 + r)})^n] \\[/tex]
[tex]=\frac{3,360}{(0.09 - 0.05)}[1 - (\frac{1.05}{1.09})^{35}]\\\\[/tex]
[tex]=\frac{3,360}{(0.04)}[1 - (0.270207895)]\\\\=\frac{3,360}{(0.04)}[ 0.729792105]\\\\=\frac{2452.10147}{(0.04)}\\\\= 61,302.5368 \\\\ = \bold{61,303}[/tex]
In point b:
[tex]PV= [ \frac{P}{(r-g)}] \times [1-[\frac{(1+g)}{(1+r)}]^{n}][/tex]
[tex]= [ \frac{1,040,000}{(11 \%-6\% )}] \times [1-[\frac{(1+6 \% )}{(1+11 \%)}]^{10}] \\\\= [ \frac{1,040,000}{(5 \%)}] \times [1-[\frac{1.06}{(1.11)}]^{10}] \\\\= [ \frac{1,040,000}{(5 \%)}] \times [1-[(0.954954955)]^{10}] \\\\= [ \frac{1,040,000}{(5 \%)}] \times [1- 0.630708763] \\\\= [ \frac{1,040,000}{(5 \%)}] \times 0.369291237\\\\= [ \frac{1,040,000}{(5 \%)}] \times 0.369291237\\\\= 20800000 \times 0.369291237 \\\\= 7,681,257.74[/tex]
In point c:
[tex]PV= \frac{PMT \times (1- \frac{1}{1+r^n})}{r}\\[/tex]
[tex]= \frac{1200 \times 1- (\frac{1}{1.08^{24}})}{0.08}\\\\= \frac{1200 \times 1- (0.157699337)}{0.08}\\\\= \frac{1200 \times 0.842300663}{0.08}\\\\= \frac{1010.7608}{0.08}\\\\=12634.51\\\\= \bold{12635}[/tex]
Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 50,000 of these balls, with the following results:_______.
Sales (50,000 balls) $ 1,250,000
Variable expenses 750,000
Contribution margin 500,000
Fixed expenses 320,000
Net operating income $ 180,000
Required:
1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year’s sales level.
2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls?
3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $202,000, as last year?
4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a), what selling price per ball must it charge next year to cover the increased labor costs?
5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company’s new CM ratio and new break-even point in balls?
6. Refer to the data in (5) above.
a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $202,000, as last year?
b. Assume the new plant is built and that next year the company manufactures and sells 37,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage.
Answer:
Please find attached solutions
Explanation:
a. Last year contribution margin ratio
= Contribution margin / Sales
= $500,000 / $1,250,000
= 40%
ai Break even point in balls
But Contribution margin per unit
= $25 - $15
= $10 per unit.
Therefore ,
Break even point in balls
= Fixed cost / Contribution margin per unit
= $320,000 / $10
= 32,000 balls.
b. The degree of operating leverage at last year' s sales level
= Contribution margin / Net operating income
= $500,000 / $180,000
= 2.78
Please other solutions are as attached.
Brilliant Accents Company manufactures and sells three styles of kitchen faucets: Brass, Chrome, and White. Production takes 25, 25, and 10 machine hours to manufacture 1000-unit batches of brass, chrome and white faucets, respectively. The following additional data apply:
BRASS CHROME WHITE
Projected sales in units 30,000 50,000 40,000
Per unit data: Selling price $40 $20 $30
Direct materials $8 $4 $8
Direct labor $15 $3 $9
Overhead cost based on
direct labor hours
(traditional system) $12 $3 $9
Hours per 1000-unit batch:
Direct labor hours 40 10 30
Machine hours 25 25 10
Setup hours 1.0 0.5 1.0
Inspection hours 30 20 20
Total overhead costs and activity levels for the year are estimated as follows:
Activity Overhead costs Activity levels
Direct Labor hours 2,900 hours
Machine hours 2,400 hours
Setups $465,500 95 setup hours
Inspections $405,000 2,700 inspection hours $870,500
1. Using the ABC system, for each style of faucet, compute the estimated overhead cost per unit.
2. Compute the estimated operating profit per unit.
Answer:
1. Using the ABC system, for each style of faucet, compute the estimated overhead cost per unit.
Brass = [(30 x $4,900) + (900 x $150)] / 30,000 units = $9.40 per unit
Chrome = [(25 x $4,900) + (1,000 x $150)] / 50,000 units = $5.45 per unit
White = [(40 x $4,900) + (800 x $150)] / 40,000 units = $7.90 per unit
2. Compute the estimated operating profit per unit.
Brass = $40 - $8 - $15 - $9.40 = $7.60
Chrome = $20 - $4 - $3 - $5.45 = $7.55
White = $30 - $8 - $9 - $7.90 = $5.10
Explanation:
cost per setup = $465,500 / 95 = $4,900 per setup hour
cost per inspection = $405,000 / 2,700 = $150 per inspection hour
BRASS CHROME WHITE
Projected sales in units 30,000 50,000 40,000
Per unit data: Selling price $40 $20 $30
Direct materials $8 $4 $8
Direct labor $15 $3 $9
Setup hours 30 25 40
Inspection hours 900 1,000 800
Classifications on Balance SheetThe balance sheet contains the following major sections:Current assetsLong-term investmentsProperty, plant, and equipmentIntangible assetsOther assetsCurrent liabilitiesLong-term liabilitiesContributed capitalRetained earningsAccumulated other comprehensive incomeRequired:The following is a list of accounts. Using the letters A through J, indicate in which section of the balance sheet each of the accounts would be classified. If an account does not belong under one of the sections listed, select "Not under any of the choices" from the classification drop down box. For all accounts, indicate if the account is a contra account or an account that would normally be deducted on the balance sheet by selecting "yes" from the second drop down box, otherwise select "no".Account Classification Contra orDeducted (Yes/No)1. Cash 2. Bonds Payable (due in 8 years) 3. Machinery 4. Deficit 5. Unexpired Insurance 6. Franchise (net) 7. Fund to Retire Preferred Stock 8. Current Portion of Mortgage Payable 9. Accumulated Depreciation 10. Copyrights 11. Investment in Held-to-Maturity Bonds 12. Allowance for Doubtful Accounts 13. Notes Receivable (due in 3 years) 14. Property Taxes Payable 15. Deferred Taxes Payable 16. Additional Paid-in Capital on Preferred Stock 17. Premium on Bonds Payable (due in 8 years) 18. Work in Process 19. Common Stock, $1 par 20. Land 21. Treasury Stock (at cost) 22. Unrealized Increase in Value of Available-for-Sale Securities
Answer:
1. Cash ⇒ CURRENT ASSETS, NOT A CONTRA ACCOUNT
2. Bonds Payable (due in 8 years) ⇒ LONG TERM LIABILITY, NOT A CONTRA ACCOUNT
3. Machinery ⇒ FIXED ASSET, NOT A CONTRA ACCOUNT
4. Deficit ⇒ PART OF RETAINED EARNINGS, NOT A CONTRA ACCOUNT
5. Unexpired Insurance ⇒ GENERALLY CURRENT ASSET (AT LEAST THE PORTION OF PREPAID INSURANCE THAT COVERS THE NEXT 12 MONTHS), NOT A CONTRA ACCOUNT
6. Franchise (net) ⇒ INTANGIBLE ASSET, NOT A CONTRA ACCOUNT
7. Fund to Retire Preferred Stock ⇒ LONG TERM INVESTMENT, NOT A CONTRA ACCOUNT
8. Current Portion of Mortgage Payable ⇒ CURRENT LIABILITY, NOT A CONTRA ACCOUNT
9. Accumulated Depreciation ⇒ PART OF FIXED ASSETS, CONTRA ACCOUNT
10. Copyrights ⇒ INTANGIBLE ASSET, NOT A CONTRA ACCOUNT
11. Investment in Held-to-Maturity Bonds ⇒ LONG TERM INVESTMENT, NOT A CONTRA ACCOUNT
12. Allowance for Doubtful Accounts ⇒ PART OF CURRENT ASSETS, CONTRA ACCOUNT
13. Notes Receivable (due in 3 years) ⇒ LONG TERM INVESTMENT, NOT A CONTRA ACCOUNT
14. Property Taxes Payable ⇒ CURRENT LIABILITY, NOT A CONTRA ACCOUNT
15. Deferred Taxes Payable ⇒ LONG TERM LIABILITY, NOT A CONTRA ACCOUNT
16. Additional Paid-in Capital on Preferred Stock ⇒ CONTRIBUTED CAPITAL, NOT A CONTRA ACCOUNT
17. Premium on Bonds Payable (due in 8 years) ⇒ LONG TERM LIABILITY, IT IS AN ADJUNCT ACCOUNT NOT A CONTRA ACCOUNT
18. Work in Process ⇒ CURRENT ASSET, NOT A CONTRA ACCOUNT
19. Common Stock, $1 par ⇒ CONTRIBUTED CAPITAL, NOT A CONTRA ACCOUNT
20. Land ⇒ FIXED ASSET, NOT A CONTRA ACCOUNT
21. Treasury Stock (at cost) ⇒ CONTRIBUTED CAPITAL, CONTRA ACCOUNT
22. Unrealized Increase in Value of Available-for-Sale Securities ⇒ ACCUMULATED OTHER COMPREHENSIVE INCOME, NOT A CONTRA ACCOUNT
Pun Corporation concluded the fair value of Slender Company was $67,000 and paid that amount to acquire its net assets. Slender reported assets with a book value of $53,000 and fair value of $64,000 and liabilities with a book value and fair value of $21,000 on the date of combination. Pun also paid $14,000 to a search firm for finder’s fees related to the acquisition.
Required:
Prepare the journal entries to be made by Pun to record its investment in Slender and its payment of the finder's fees.
Answer:
DR Assets ...............................................................$64,000
DR Goodwill ...........................................................$24,000
CR Liabilities ..............................................................................$21,000
CR Cash.......................................................................................$67,000
(To record Acquisition of Slender Assets)
Working
Goodwill = Cash - (Assets - Liabilities)
= 67,000 - (64,000 - 21,000)
= $24,000
DR Merger ...................................................................$14,000
CR Cash........................................................................................$14,000
(To record payment of finder's fee)