Answer:
I ,II and IV
Explanation:
Mortgage backed securities are either a claim for equity in a pool of mortgages, or a duty secured by a pool. Such claims reflect home loan securities. Loans borrow from mortgage lenders and then sell bundles of those loans on the resale market.
Specifically, once those loans are paid off, they sell their claim to the mortgage cash inflows. The issuer of the mortgage needs to maintain the loan, receiving principal and interest payments, and transfers those payments on to the mortgage borrower.
Therefore according to the given situation the correct answer is I, II, IV
a company sells 600 bottles of a dietary supplement per week at$ 100 per bottle. The supplement is ordered from a supplier who charges fixed cost of $30 per order, and $ 50 per bottle. The annual inventory holding cost is 40%. Assume the company operates 50 weeks in a year. What is the optimal number of bottles company should order?
Answer:
the economic order quantity or optimal quantity = 300 bottles per order
Explanation:
economic order quantity (EOQ) = √[(2SD) / H]
S = cost per order = $30D = annual demand = 600 x 50 weeks = 30,000H = holding costs = $50 x 40% = $20EOQ = √[(2 x $30 x 30,000) / $20] = √($1,800,000 / $20) = √90,000 = 300
This means that the company must make 2 orders per week and 100 orders per year. This happens because the holding costs per unit are too high, therefore, in order to reduce costs you must have a small inventory.
The level of analysis to use when identifying user goals is the _______. a. elementary activity level b. temporal event level c. elementary business process level d. external event level
Answer:
elementary business process level
Explanation:
Elementary Business Processes can be defined as a task carried out by one person, one place at a time, which is done in reaction to a business event, that could be of quantifiable business value with data being left in a steady state
It represents the smallest level of process decomposition from a business viewpoint. It could be manual, automated, or both. Like I explained earlier, it is Carried out by one person or process, at one location and one time.
Lincoln Park Co. has a bond outstanding with a coupon rate of 5.66 percent and semiannual payments. The yield to maturity is 6.3 percent and the bond matures in 16 years. What is the market price if the bond has a par value of $2,000?
Answer:
Market price of Bond = $1872.135629 rounded off to $1872.14
Explanation:
To calculate the price of the bond, we need to first calculate the coupon payment per period. We assume that the interest rate provided is stated in annual terms. As the bond is a semi annual bond, the coupon payment, number of periods and semi annual YTM will be,
Coupon Payment (C) = 2000 * 0.0566 * 1/2 = $56.6
Total periods (n)= 16 * 2 = 32
r = 6.3% * 1/2 = 3.15% or 0.0315
The formula to calculate the price of the bonds today is attached.
Bond Price = 56.6 * [( 1 - (1+0.0315)^-32) / 0.0315] + 2000 / (1+0.0315)^32
Bond Price = $1872.135629 rounded off to $1872.14
Suppose the demand for macaroni is inelastic, the supply of macaroni is elastic, the demand for cigarettes is inelastic, and the supply of cigarettes is elastic. If a tax were levied on the sellers of both of these commodities, we would expect that the burden of Group of answer choices
Answer:
This question is incomplete, the options are missing. The options are the following:
a) Both taxes would fall more heavily on the buyers than on the sellers.
b) The macaroni tax would fall more heavily on the sellers than on the buyers and the burden of the cigarette tax would fall more heavily on the buyers than on the sellers.
c) The macaroni tax would fall more heavily on the buyers than on the sellers and the burden of the cigarette tax would fall more heavily on the sellers than on the buyers.
d) Both taxes would fall more heavily on the sellers than on the buyers.
And the correct answer is the option A: Both taxes would fall more heavily on the buyers than on the sellers
Explanation:
To begin with, in this situation due to the fact that the demand for both products are inelastic and the supply of both as well are elastic then the change in the price that would happen because of the tax would have an impact that the buyers will feel more than the sellers because they are the one that no matter how much the price changes then the they will keep to consuming the same amount in both cases and that is because their demand are inelastic and therefore that the variation in the price does not change dramastically the variation in the quantity demanded.
You can now sell 40 cars per month at $20,000 per car, and demand is increasing at a rate of 3 cars per month each month. What is the fastest you could drop your price before your monthly revenue starts to drop
Answer:
More than $1500 price per car per month has to be dropped.
Explanation:
Given:
price per car = $20,000
car sale per month = 40
rate of increase in demand = 3
Solution:
Revenue R = Price × Quantity = P * Q
From the above given data
P = 20,000
Q = 40
R = P*Q
dQ/dt = 3
We have to find the rate at which the price is to be dropped before monthly revenue starts to drop.
R = P*Q
dR/dt = (dP/dt)Q + P(dQ/dt)
= (dP/dt) 40 + 20,000*3 < 0
= (dP/dt) 40 < 60,000
= dP/dt < 60000/40
= dP/dt < 1,500
Hence the price has to be dropped more than $1,500 before monthly revenue starts to drop.
Answer:
For the monthly revenue starts to drop, the price of the car has to drop more than $1500
Explanation:
Given that:
Price of a car = $20,000
quantity = 40
demand rate = 3
the fastest you could drop your price before your monthly revenue starts to drop can be calculated by using the formula
R = P × Q
i.e themontly revenue function R is the product of the price per unit P times the number of units sold Q
Differentiating with respect to time; we have :
[tex]\dfrac{dR}{dt}=(\dfrac{dP}{dt} )Q+P(\dfrac{dQ}{dt})[/tex]
[tex](\dfrac{dP}{dt} )40+20000 \times 3<0[/tex]
[tex](\dfrac{dP}{dt} )40+60000 <0[/tex]
[tex](\dfrac{dP}{dt} )40 <-60000[/tex]
[tex](\dfrac{dP}{dt} ) <\dfrac{-60000}{40}[/tex]
[tex](\dfrac{dP}{dt} ) <-1500[/tex]
Therefore; For the monthly revenue starts to drop, the price of the car has to drop more than $1500
1. Pure monopoly: a. has never existed b. is an economic model c. is the best option for capitalism d. is the best option for socialism 2. the prices producers charge to cover the cost of supply may be seen on a: a. television economic update b. trade journal c. index table of interest rates d. supply curve 3. in a competitive free market (i.e., perfect market) buyers and sellers do not have to: a. pay for things that others enjoy b. sell goods cheap c. feel tax oppression from the government d. do their own taxes 4. One of the most significant disadvantages of a monopoly is: a. oligarch capitalization b. no competition from international markets c. price wars d. high prices charged 5. D Ram prices in the U.S. were _____ in Dec-01 a. close to $1 b. better than those in potato sales c. not comparable to those of Vietnamese markets d. fixed 6. Pressure, rationalization, and opportunity help indicate issues that lead to: a. NYPD law investigation b. forensic dissecting of butterflies c. price fixing d. background checks 7. The U.S. has an extensive history of a. successful battles b. ethics in every industry c. ethics in India d. legislation dealing with antitrust 8. mixed economies rely on _______ to help with their deficiencies : a. governmental policy b. their citizens c. good business practices d. ethical behavior 9. which is a main view on how to address monopoly issues: a. regulation b. government war c. move to a different place d. competition above all. 10. Monopoly hinders: a. incentives to come up with new technology. b. all things true of a commercial enterprise c. governmental accounting efficiency d. socialism and Marxism.
Answer:
1. b. is an economic model
2. d. supply curve
3. a. pay for things that others enjoy
4. d. high prices charged
5. a. close to $1
6. c. price fixing
7. d. legislation dealing with antitrust
8. a. governmental policy
9. a. regulation
10. b. all things true of a commercial enterprise
Explanation:
Monopoly is a market structure that exists where there is a single seller, selling a single product or service to many buyers with complete control of the market. This situation confers on the seller an economic advantage to the detriment of the overall economy, including market inefficiencies due to the absence of competition. There are many variants to monopoly, including pure monopoly, natural, and monopolistic competition.
Bottum Corporation, a manufacturing Corporation, has provided data concerning its operations for May. The beginning balance in the raw materials account was $24,000 and the ending balance was $44,000. Raw materials purchases during the month totaled $71,000. Manufacturing overhead cost incurred during the month was $115,000, of which $2,800 consisted of raw materials classified as indirect materials. The direct materials cost for May was:
Answer:
$48,200
Explanation:
The computation of the direct material cost for the month of May is shown below:
Direct materials cost = Beginning raw materials inventory + purchases made - Ending balance of raw materials - Indirect materials
= $24,000 + $71,000 - $44,000 - $2,800
= $48,200
Hence, the direct material cost for the month of May is $48,200
Two firms examined the same capital budgeting project which had an IRR of 16%. One firm accepted the project but the other rejected it. One of the firms must have made an incorrect decision.
Discuss the validity of this statement.
Answer:
the statement is not valid. A company can reject the 16% IRR project if it is less than its discount rate. the discount rate is the minimum acceptable rate at which a project can be accepted. so, if 16% is less than than the discount rate, the project would be rejected.
on the other hand, if the discount rate is less than 16%, the project should be accepted because the return of the project would be greater than the discount rate.
Explanation:
Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.
HELP ASAP
Since infants and toddlers need a variety of experiences in early childhood, it is
important that the home setting and the child care setting strive to be as different as
possible.
A. True
B. False
Answer:
I think that it is true to an extent
Consider the corporate valuation model, if the WACC increases what happens to the present value of the firm. Group of answer choices It is indeterminant the present value will stay the the present value will decrease The corporate valuation model doesn't depend the WACC The present value will increase
Answer:
ydjdtedyeydgkkutlryodiydhdiy
Per Chevron’s 3Q 2013 filing, what was the percentage change in the cost of purchased oil products when comparing nine months ended September 30, 2013 versus the same period in 2012?
Answer:
Per Chevron 3Q 2013 Filling:
The percentage change in the cost of purchased oil products nine months to September 30, 2013 when compared to nine months in 2012 was:
2.47%
Explanation:
a) Data and Calculations:
Cost of purchased oil products:
2013 $34,822,000,000
2012 $33,982,000,000
Change $840,000,000
Percentage Change = $840/$33,982 x 100
= 2.47%
b) The implication is that Chevron's cost of purchased oil products in third quarter of 2013 increased by 2.47% when compared with the same period in 2012. This percentage change is calculated by subtracting the Q3 2012 cost of purchased oil products from the Q3 2013 cost of purchased oil products and then dividing the difference by the Q3 2012, and multiplying by 100. The change could be caused by increases in the price of oil products or other variables.
Which term is defined as the most appealing trade-off or item given up as the result of an
economic decision?
Increasing cost
Opportunity cost
Recycled trade off
Economic trade off
Answer:
it could be the increase in cost due to economical well-being either the increase in debt or credit
Power Manufacturing recorded operating data for its shoe division for the year. Sales $1,500,000 Contribution margin 300,000 Controllable fixed costs 180,000 Average total operating assets 600,000 How much is controllable margin for the year
Answer:
Controllable margin for the year is $120,000.
Explanation:
Controllable margin refers to contribution margin minus controllable fixed costs. Controllable margin is usually employed to assess the performance of managers because all the costs that the profit center manager can control are included in the calculation of controllable margin.
Based on the explanation above, controllable margin for this question can therefore be calculated as follows:
Controllable margin = Contribution margin - Controllable fixed costs = $300,000 - $180,000 = $120,000
Therefore, controllable margin for the year is $120,000.
Financial Statements of a Manufacturing Firm
The following events took place for Focault Inc. during July 20Y2, the first month of operations as a producer of road bikes:
Purchased $320,000 of materials
Used $275,000 of direct materials in production
Incurred $236,000 of direct labor wages
Applied factory overhead at a rate of 75% of direct labor cost
Transferred $652,000 of work in process to finished goods
Sold goods with a cost of $630,000
Sold goods for $1,120,000
Incurred $252,800 of selling expenses
Incurred $100,000 of administrative expenses
A. Prepare the July income statement for Focault. Assume that Focault uses the perpetual inventory method.
Focault Inc.
Income Statement
For the Month Ended July 31
Revenues $
Cost of Goods Sold
Gross Profit $
Selling and administrative expenses:
Selling Expenses $
Administrative Expenses
Total selling and administrative expenses
Income from Operations $
B. Determine the inventory balances at the end of the first month of operations.
Materials inventory, July 31
Work in process inventory, July 31
Finished goods inventory, July 31
Answer:
Required A.
Focault Inc.
Income Statement For the Month Ended July 31
Revenues $1,120,000
Cost of Goods Sold ($630,000)
Gross Profit $ 490,000
Selling and administrative expenses:
Selling Expenses ($252,800)
Administrative Expenses ($100,000)
Income from Operations $137,2000
Required B
Materials inventory, July 31 = $45,000
Work in process inventory, July 31 = $36,000
Finished goods inventory, July 31 = $22,000
Explanation:
Raw Materials T - Account
Debit :
Purchases $320,000
Totals $320,000
Credit:
Used in Production $275,000
Ending Balance $45,000
Totals $320,000
Manufacturing Cost Schedule
Raw Materials $275,000
Direct labor $236,000
Overheads ($236,000 × 75%) $177,000
Total Manufacturing Cost $688,000
Less Cost Transferred to Finished Goods ($652,000)
Ending Work In Process $36,000
Finished Goods T - Account
Debit :
Cost of Goods Manufactured $652,000
Totals $652,000
Credit :
Trading Account : Cost of Sales ($630,000)
Ending Balance $22,000
Totals $652,000
Supplies on hand were $900 at the start of the year. At the end of the year, it was determined that $350 of supplies had been used. What is the adjusting entry for supplies
Answer:
the adjusting entry for supplies :
Supplies Expense $350 (debit)
Supplies Account $350 (credit)
Explanation:
The fall in value of supplies on hand is due to utilization of the asset in in the business during the year.
The entry to adjust the utilization of the Supplies is to Debit the Supplies Expense (Expense) and Credit the Supplies Account (Asset) by the amount utilized of $350.
What is the payback period for the above set of cash flows? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
Answer: 2.74 years
Explanation:
Payback Period is a method of capital budgeting that works by checking how long the project will take to repay the investment outlay.
The formula is;
Payback Period = Year before Payback Period occurs + [tex]\frac{Cash remaining}{Cashflow in year payback happens}[/tex]
Initial Outlay = $4,650
First Year = $1,350
Second Year = $2,450
Third Year = $1,150
First year + second year = 1,350 + 2,450 = $3,800
Remaining till repayment = 4,650 - 3,800 = $850
Third year amount of $1,150 is higher than $850 so amount will be repaid in 3rd year.
Payback Period = Year before Payback Period occurs + [tex]\frac{Cash remaining}{Cashflow in year payback happens}[/tex]
Payback Period = 2 + [tex]\frac{850}{1,150}[/tex]
Payback Period = 2.74 years
A granary allocates the cost of unprocessed wheat to the production of feed, flour, and starch. For the current period, unprocessed wheat was purchased for $240,000, and the following quantities of product and sales revenues were produced.
Product Pounds Price per Pound
Feed 100,000 $0.70
Flour 50,000 2.20
Starch 20,000 1.00
How much of the $240,000 cost should be allocated to feed?
a. $24,500.
b. $84,000.
c. $90,000.
d. $70,000.
e. $200,000.
Answer:
$84,000
Explanation:
A granny allocates the costs of unprocessed wheat to production of feed, flour and starch
The unprocessed wheat was bought at the price of $240,000
The first step is to calculate the total amount of the products(feed, flour and starch)
Feed= 100,000×0.70= 70,000
Flour= 50,000×2.0= 110,000
Starch= 20,000×1.0= 20,000
Total cost= 70,000+110,000+20,000
= $200,000
Therefore, the amount that should be allocated to the feed can be calculated as follows
= $70,000/$200,000×$240,000
= 0.35×$240,000
= $84,000
Hence the cost that should be allocated to the feed is $84,000
Nichols Enterprises has an investment in 31,500 bonds of Elliott Electronics that Nichols accounts for as a security available for sale. Elliott bonds are publicly traded, and The Wall Street Journal quotes a price for those bonds of $10 per bond, but Nichols believes the market has not appreciated the full value of the Elliott bonds and that a more accurate price is $23 per bond. Nichols should carry the Elliott investment on its balance sheet at:
Answer: $315,000
Explanation:
From the question, we are informed that Nichols Enterprises has an investment in 31,500 bonds of Elliott Electronics that Nichols accounts for as a security available for sale. Elliott bonds are publicly traded, and The Wall Street Journal quotes a price for those bonds of $10 per bond, but Nichols believes the market has not appreciated the full value of the Elliott bonds and that a more accurate price is $23 per bond.
To get the amount that Nichols should carry on the balance sheet as Elliott investment, we multiply the bond invested by the price per bond. This will be:
= 31,500 × $10
= $315,000
On January 1, 2017, Boston Enterprises issues bonds that have a $2,050,000 par value, mature in 20 years, and pay 8% interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much interest will Boston pay (in cash) to the bondholders every six months
Answer:
Boston will pay (in cash) to the bondholders every six months $125,146.31.
Explanation:
The interest paid in cash PMT, can be calculated as follows :
PV = $2,050,000
N = 20 × 2 = 40
R = 8%
FV = $2,050,000
P/yr = 2
PMT = ?
Using a financial calculator to enter the above data concerning the bond, the payments (PMT) every six months is $125,146.3062 or $125,146.31.
Horton, Reiser, and Associates, a law firm, employs ABC. The following budgeted data for each of the activity cost pools is provided for the year 2016.
Activity Cost Pools Estimated Overhead Expected Use of Cost Drivers per Activity
Researching legal Issues $31,500 900 research hours
Meeting with clients 1,760,000 8,800 professional hours
Preparing legal documents 480,000 30,000 pages
During 2016 the firm worked 660 research hours, prepared 25,000 document pages, and 10,000 professional hours.
Compute the total overhead applied during 2016.
Total overhead applied $_____
Answer:
Total overhead= $2,423,100
Explanation:
Giving the following information:
During 2016 the firm worked 660 research hours, prepared 25,000 document pages, and 10,000 professional hours.
First, we need to calculate the predetermined overhead rate for each activity:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Researching= 31,500/900= $35 per research hour
Meeting with clients= 1,760,000/8,800= $200 per professional hour
Preparing legal documents= 480,000/30,000= $16 per page
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Researching= 35*660= $23,100
Meeting with clients= 200*10,000=$2,000,000
Preparing legal documents= 16*25,000= $400,000
Total overhead= $2,423,100
A corporation issued 2,500 shares of its no par common stock at a cash price of $11 per share. The entry to record this transaction would be: A. Debit Treasury Stock $27,500; credit Cash $27,500. B. Debit Cash $27,500; credit Common Stock $27,500. C. Debit Common Stock $27,500; credit Cash $27,500. D. Debit Cash $27,500; credit Paid-in Capital in Excess of Par Value, Common Stock $2,500; credit Common Stock $25,000. E. Debit Treasury Stock $2,500; debit Paid-in Capital in Excess of Par Value, Treasury Stock $25,000; credit Common Stock $27,500.
Answer:
B. Debit cash $27,500 ; Credit common stock $27,500
Explanation:
The journal entry to record the transaction is;
Cash account Dr $27,500
(2,500 shares × $11)
To Common stock account Cr $27,500
Cash is an asset hence debited because it decreases as it was used to pay for bills while common stock is credited because it increases shareholder's equity.
The following equation summarizes the trend of quarterly sales of condominiums over a long cycle. Sales also exhibit seasonal variation.
Ft = 40 - 6.5t + 2t2
Ft = Unit sales
Where t = 0 the first quarter of last year
Quarter Relative
1 .95
2 .90
3 .45
4 1.70
Prepare a forecast of quarterly sales for next year and the first quarter of the year following that.
Quarter Forecast
1
2
3
4
1
Answer:
Quarter: 1-4, 1. Forecast:
128.92, 146.10, 107.40, 280.67, 282.48
Explanation:
The quarterly sales trend for the quarter is represented by the following equation: 1-4, 1. Forecast
What are representatives?The term representative refers that the person who is serving to represent something as we see there are some diplomats are being there who represent the country, and there is someone who represents the states as there are different peoples who are being there in it. As there are different players as we see, they represent the nation as well.
Quarter: 1-4, 1. Forecast
128.92, 146.10, 107.40, 280.67, 282.48
Therefore, the quarter is represented by the following equation: 1-4, 1. Forecast
Learn more about representatives here:
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Quarter: 1-4, 1. Forecast:
128.92, 146.10, 107.40, 280.67, 282.48
Brodrick Company expects to produce 20,000 units for the year ending December 31. A flexible budget for 20,000 units of production reflects sales of $400,000; variable costs of $80,000; and fixed costs of $150,000. The company instead produces and sells 26,000 units for the year. Assume that actual sales are $480,000, actual variable costs for the year are $112,000, and actual fixed costs for the year are $145,000.
Prepare a flexible budget performance report for the year.
Answer:
Flexible budget performance report for the year
Sales ($400,000 / 20,000 × 26,000) $520,000
Less Variable Costs ($80,000 / 20,000 × 26,000) ($104,000)
Less Fixed costs ($150,000)
Budgeted Income / (Loss) $266,000
Explanation:
A flexed Budget is a Master Budget that has been adjusted to the Actual number of units produced and sold instead of Budgeted Units.
Note : Fixed Costs will the the same under the Master Budget and the Flexed Budget.
From studying Geert Hofstede’s cultural dimensions, what differences exist between the United States and Brazil that may be relevant to your communication? 2. How can you use words to relate to each audience? 3. What images will you use for each audience?
Answer:
what differences exist between the United States and Brazil that may be relevant to your communication?
Using Geert Hofstede's cultural dimensions as a framework, we can determine that the United States is higher on individualism while Brazil is higher on collectivism.
The United States is also higher on restraint, while Brazil is higher on indulgence.
2. How can you use words to relate to each audience?
For the United States, you should use words that motivate individuals. For Brazil, you should words that motivate collective groups.
3. What images will you use for each audience?
Again, for the United States, you should use images that represent individualistic cultural values, while the opposite should be used for Brazil: picture that represent more collectivist cultural values.
Select the type of business that is most likely to obtain large amounts of resources by issuing stock. a. government entity b. partnership c. proprietorship d. corporation
Answer:
d. corporation
Explanation:
A corporation raises its capital by issue of stocks and Stockholders that subscribe for these shares will in turn receive their return in form of dividends.
Partnerships, government entities and sole proprietorship do not raise capital by issuance of stocks.
The type of business that is most likely to obtain large amounts of resources by issuing stock is d. corporation
The following information should be considered:
A corporation raises its capital via issue of stocks and in return the Stockholders get the returns in the form of dividends for subscribing the shares Partnerships, government entities and sole proprietorship do not raise capital via issuance of stocks.learn more: https://brainly.com/question/17429689?referrer=searchResults
On April 1, 2021, Shoemaker Corporation realizes that one of its main suppliers is having difficulty meeting delivery schedules, which is hurting Shoemaker's business. The supplier explains that it has a temporary lack of funds that is slowing its production cycle. Shoemaker agrees to lend $420,000 to its supplier using a 12-month, 12% note.
Required:
1. The loan of $420,000 and acceptance of the note receivable on April 1, 2021
2. The adjustment for accrued interest on December 31, 2021
3. Cash collection of the note and interest on April 1, 2022.
Answer:
1. April 01, 2021
Dr Notes receivable 420,000
Cr Cash 420,000
2. December 31,2021
Dr Interest receivable 37,800
Cr Interest revenue 37,800
3. April 01, 2022
Dr Cash 470,400
Cr Notes receivable 420,000
Cr Interest receivable 37,800
Cr Interest revenue 12,600
Explanation:
Preparation of the Journal entries Shoemaker Corporation
1. Preparation of the Journal entry for loan o amount of $420,000 as well as the acceptance of the note receivable on April 1, 2021
April 01, 2021
Dr Notes receivable 420,000
Cr Cash 420,000
2. Preparation of the Journal entry for the adjustment for accrued interest on December 31, 2021
December 31,2021
Dr Interest receivable 37,800
Cr Interest revenue 37,800
($420,000 × 12% × 9/12=$37,800)
3. Preparation of the Journal entry for the Cash collection of the note and interest on April 1, 2022
April 01, 2022
Dr Cash 470,400
Cr Notes receivable 420,000
Cr Interest receivable 37,800
Cr Interest revenue 12,600
($420,000 × 12% × 3/12=$12,600)
Mountain High Ice Cream Company transferred $65,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amount to Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables, it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,500). Mountain High anticipates a $3,500 recourse obligation. The bank charges a 3% fee (3% of $65,000), and requires that amount to be paid at the start of the factoring arrangement.
Required:
Prepare the journal entry to record the transfer on the books of Mountain High assuming that the sale criteria are met.
Answer:
Dr Cash 56,550
Dr Receivable from factor 5,500
Dr Loss on sale of receivables 6,450
Cr Accounts receivables 65,000
Cr Recourse liability 3,500
Explanation:
cash = ($65,000 x 90%) - factoring fees = $58,500 - $1,950 = $56,550
factoring fees = $65,000 x 3% = $1,950
loss on sale of receivables (includes factoring fees) = (accounts receivables + recourse liability) - (cash + receivable from factor) = ($65,000 + $3,500) - ($56,550 + $5,500) = $68,500 - $62,050 = $6,450
You have a portfolio that is equally invested in Stock F with a beta of 1.08, Stock G with a beta of 1.45, and the market. What is the beta of your portfolio
Answer:
1.265
Explanation:
According to the situation, the solution of the beta of portfolio is as follows
Beta portfolio = (weightage of investment F × beta F) + (proportion of investment G ×beta G)
Beta protfolio = (0.5 × 1.08) + (0.5 × 1.45)
= 0.54 + 0.725
= 1.265
Hence, the beta of your portfolio is 1.265 by applying the above formula
Product Pricing: Two Products Quality Data manufactures two products, CDs and DVDs, both on the same assembly lines and packaged 10 disks per pack. The predicted sales are 400,000 packs of CDs and 500,000 packs of DVDs. The predicted costs for the year 2014 are as follows:
Variable Costs Fixed Costs
Materials $200,000 $500,000
Other 250,000 800,000
Each product uses 50 percent of the materials costs. Based on manufacturing time, 40 percent of the other costs are assigned to the CDs, and 60 percent of the other costs are assigned to the DVDs. The management of Quality Data desires an annual profit of $100,000.
(a) What price should Quality Data charge for each disk pack if management believes the DVDs sell for 20 percent more than the CDs? Round answers to the nearest cent.
CDs $
DVDs $
(b) What is the total profit per product using the selling prices determined in part (a)? Use negative signs with answers, if appropriate.
CDs $
DVDs $
Answer:
a) $1.85 per CD pack
$2.22 per DVD pack
b) profits for selling CDs = -$30,000
profits for selling DVDs = $130,000
Explanation:
Variable costs Fixed costs
Materials $200,000 $500,000
Other $250,000 $800,000
DVDs:
materials = $700,000 x 50% = $350,000 ($250,000 fixed)
Other = $1,050,000 x 60% = $630,000 ($480,000 fixed)
total = $980,000
CDs:
materials = $350,000 ($250,000 fixed)
Other = $420,000 ($320,000 fixed)
total = $770,000
Expected sales:
CDs 400,000 packs
DVDs 500,000 packs
since the company wants to earn $100,000 in profits, it should charge:
400,000X - $770,000 + 500,000Y - $980,000 = $100,000
400,000X + 500,000Y = $1,850,000
Y = 1.2X (we replace Y)
400,000X + 600,000X = $1,850,000
1,000,000X = $1,850,000
X = $1,850,000 / 1,000,000 = $1.85 per CD pack
Y = $1.85 x 1.2 = $2.22 per DVD pack
profits for selling CDs = ($1.85 x 400,000) - $770,000 = -$30,000
profits for selling DVDs = ($2.22 x 500,000) - $980,000 = $130,000
A 7X Corp.just paid a dividend of $2.30 per share. The dividend are expected to grow at 23 percent for the next eight years and then level off to a growth rate of 7 percent indefinitely. If the required return is 15 percent, what is the price of the stock today?
Answer:
Price of stock=$ 77.88
Explanation:
The Dividend Valuation Model is a technique used to value the worth of an asset. According to this model, the worth of an asset is the sum of the present values of its future cash flows discounted at the required rate of return.
The price of the stock will the sum of the present value of the growing annuity and the growing perpetuity
Present value of dividend from year 1 to 8
The PV of the growing annuity = A/r-g) ( 1- (1+g)/(1+r)^n )
A- dividend payable now , r- required of return, g-growth rate, number of years
PV = (2.30×1.23)/(0.15-0.23)× (1- (1.23/1.15)^8) = 25.199
PV of Dividend from year 9 and beyond:
P = D× g/(r-g)
This will be done in two steps:
Step 1: PV(in year 8)of dividend = 2.30× 1.23^8×1.07/(0.15-0.07) = 161.16
Step 2 : PV in year 0 = 161.16× 1.15^(-8)= 52.684
PV of Dividend from year 9 and beyond = 52.684
Price of stock = 25.19 + 52.68= 77.88
Price of stock=$ 77.88