If the economy is experiencing a recession due to a negative aggregate demand shock, the return to potential output
will be slower, the faster wages and prices adjust
will be quicker, the slower wages and prices adjust
will be quicker, the faster wages and prices adjust
will be quick regardless of the speed of wage and price adjustment
If the economy is experiencing a recession due to a negative aggregate demand shock, the return to potential output will be slower, the faster wages and prices adjust .
Explanation:
The economic shock of demand is an unexpected phenomenon that suddenly raises or reduces demand for goods or services. A shock of positive demand increases total demand and a shock of negative demand decreases aggregate demand. In both situations, products and services costs are impacted.
Stock shocks are somewhat different from shocks of demand. In this scenario, whether such shocks are temporary or permanent depends on the long term effect.
For example, assume that a rise in oil prices results in a negative supply shock (as a raise in input prices would result in a drop in SRAS). Having a negative supply shock, demand is declining, but inflation and unemployment are rising.
Suppose that a small county is considering adding a guard rail to a dangerous curve by a river. The guard rail will cost $70,000. The average damage done to vehicles that slide off the road at the curve is $10,000. It is expected that the guard rail will prevent 5 vehicles from sliding off the road during its usable life. What should the county do?
Answer:
do not Install guard rail because the guard rail cost exceed the expected benefits
Explanation:
given data
guard rail cost = $70,000
average damage = $10,000
guard rail prevent = 5 vehicles
to find out
What should the county do
solution
we know here guard rail cost is $70,000
but expected benefits = $10,000 × 5
expected benefits = $50,000
so we can say that do not Install guard rail because the guard rail cost exceed the expected benefits
On April 2, Granger Sales decides to establish a $360 petty cash fund to relieve the burden on Accounting. Required:
(a) Journalize the establishment of the fund.
(b) On April 10, the petty cash fund has receipts for mail and postage of $34, contributions and donations of $19, meals and entertainment of $112, and $191 in the ending cash balance. Journalize the replenishment of the fund.
(c) On April 11, Granger Sales decides to increase petty cash to $470. Journalize this event.
Answer:
a) Debit= Petty Cash $360; Credit= Cash= $360
b)Debit Mail and Postages=$34,
Contributions and donations= $19,
Meals and Entertainment= $112,
Cash Over and Shorts=$4
Credit Cash= $169
C)Debit= Petty Cash $110; Credit= Cash $110
Explanation:
a) Journalise the establishment of the fund
April 2 Debit Petty Cash $360
Credit Cash A/C $360
Being the establishment of a petty cash fund
b) Petty Cash Expenditure and Replenishment
April 10 Debit Mail and Postage $34
Debit Contributions and donations $19
Debit Meals and Entertainment $112
Debit Cash Over and Shorts $4
Credit Cash A/c $169
Being the replenishment of Petty Cash fund
Note: The balance of $191 in the ending cash balance means the petty cash already expended $169. However, the addition of Mail, Contributions and Meals = $165, meaning the account is short by $4 and this must be debited as Cash shorts to make up the difference.
c) Increase in Petty Cash to $470
April 11 Debit Petty Cash $110
Credit Cash A/c $110
Being the Increase in Petty Cash account by $110 (from $360 to $470)
Granger Sales establishes a petty cash fund with a debit to Petty Cash and a credit to Cash for $360. Replenishing the fund involves debiting the respective expense accounts and crediting Cash for the total amount of the receipts. Increasing the fund requires a debit to Petty Cash and a credit to Cash for the amount of the increase.
Explanation:When Granger Sales decides to establish a petty cash fund, the journal entry on April 2 would be:
Debit Petty Cash $360Credit Cash $360This entry establishes the petty cash fund by increasing the Petty Cash account and decreasing the Cash account by $360.
When replenishing the petty cash fund on April 10, the journal entry would be:
Debit Mail and Postage Expenses $34Debit Contributions and Donations $19Debit Meals and Entertainment Expenses $112Credit Cash $165Since the receipts total $165 ($34 + $19 + $112), the Cash account is reduced, and respective expense accounts are debited. The remaining $191 is the cash on hand in the petty cash fund.
On April 11, when Granger Sales decides to increase the petty cash fund to $470, the journal entry would be:
Debit Petty Cash $110Credit Cash $110This entry increases the Petty Cash account and decreases the Cash account by $110, the amount by which the petty cash was increased.
Learn more about Petty Cash Fund here:https://brainly.com/question/29574983
#SPJ3
Use this information for Train Corporation to answer the question that follow. The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: Rails Division Locomotive Division Corporate Total Cost of goods sold $46,100 $29,500 Direct operating expenses 26,900 22,100 Sales 97,300 65,500 Interest expense $2,500 General overhead 19,200 Income tax 4,300
The gross profit for the Locomotive Division is:
Answer:
Gross profit= $36,000
Explanation:
Giving the following information:
Cost of goods sold:
Rails Division= 46,100
Locomotive Division= 29,500
Sales:
Rails Division= 97,300
Locomotive Division= 65,500
To calculate the gross profit, we need to use the following formula:
Gross profit= Sales - cost of goods sold
Gross profit (Locomotive)= 65,500 - 29,500= $36,000
Which of the following activities is part of the "planning" function of management?
a. Assigning a particular worker to do a specific task
b. Looking at market forecasts to identify future business opportunities and challenges
c. Praising a sales representative who has far exceeded her monthly sales objectives
d. Conducting a job interview with a potential new employee
Answer: Option D
Explanation: Planning involves looking forward to potential possible outcomes to be taken. It's a preliminary move. It is indeed a systemic process that decides where what and who should do a particular job. Planning refers to a comprehensive framework for potential action classes.
Planning thus took into account the institution's current & potential personnel and material capital in order to achieve successful alignment, commitment & total adjustment.
This is the basic business feature that involves the development of any or even more comprehensive strategies with the existing resources to reach an appropriate balance of requirements or expectations.
Thus, from the above we can conclude that the correct option is d.
Considering the available options, the activity that is part of the "planning" function of management is "Looking at market forecasts to identify future business opportunities and challenges."
What is Planning in Management?Planning is how the company or organization defines and determines the goals, future direction, missions, and methods including opportunities and weaknesses to achieve those targets.
Planning is part of the management functions, and it ensures that the business goals are defined and met, so there is a direction or path to follow.
Therefore, looking at market forecasts to identify future business opportunities and challenges is an example of a planning process.
Hence, in this case, it is concluded that the correct answer is option C.
Learn more about Planning here: https://brainly.com/question/6584992
You are using earned value analysis to track your project's progress. In your project, earned value is higher than planned value and actual value. That means the project is _____ schedule and _____ budget.Select an answer:A. behind; underB. ahead of; underC. ahead of: overD. behind; over
Answer:
Ahead of schedule and under the budget.
Explanation:
Earned value analysis (EVA) or Earned value management (EVM) is the technique used to track project status and evaluate the project´s progress report. These analysis been on camparing the earned value with actual cost and planned value.
Planned value is the value which is approved for the project to be completed in a given period of time. Earned value is compared with planned value to check schedule variance of project.
Actual value or cost is the cost that is spent on project while working on it till date. Earned value is compared with Actual value to check cost variance of project.
Earned value is the value of work done on project till date. It show the value of project in term of schedule and cost.
Edelman Engines has $5 billion in total assets — of which cash and equivalents total $90 million. Its balance sheet shows $1 billion in current liabilities — of which the notes payable balance totals $1.04 billion. The firm also has $3.25 billion in long-term debt and $0.75 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $24 per share. The firm's EBITDA totals $1.08 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places.
Answer:
Edelman's market/book = 2.29
Edelman's EV/EBITDA = 10.52
Explanation:
Firstly, we need to calculate enterprise value (EV) & fiem value (FV) of Edelman Engines as below:
EV = Market value of equity + Net market value of debt
= Stock price x Number of share outstanding + (Debt - Cash)
= 24 x 0.3 + (3.25 + 1 - 0.09) = 11.36
FV = Market value of equity + Market value of debt
= Stock price x Number of share outstanding + Market value of debt
= 24 x 0.3 + 3.25 + 1 = 11.45
Edelman's market/book = FV/Total asset = 11.45/5 = 2.29
Edelman's EV/EBITDA = 11.36/1.08 = 10.52
Which of the following would be considered a situation of legal employment discrimination? A. Rene, who has a disability, is rejected from a job position because another candidate did not have a disability. B. Sheryl, who has a disability, is rejected from a job position because the employer would have to pay for an accommodation. C. Charlie, who does not have a disability, is rejected from a job position because the employer thinks he has a disability. D. Meryl, who has a disability, is rejected from a job position because she doesn’t have a certification for the job she would be doing.
Answer: The correct answer is "A. Rene, who has a disability, is rejected from a job position because another candidate did not have a disability.".
Explanation: Disability discrimination occurs when an employer treats a qualified person with a disability, who is an employee or job applicant, unfavorably because he has a disability.
While in the case of option B, the law requires an employer to provide reasonable accommodation to an employee or job applicant with a disability, this is not mandatory if doing so will generate significant difficulties or expenses for the employer.
Therefore the case of option A would be considered a situation of legal employment discrimination.
Legal employment discrimination occurs when a job applicant is treated unfairly based on their race, gender, religion, age, or disability status.
Explanation:Legal employment discrimination occurs when a job applicant is treated unfairly due to their race, gender, religion, age, or disability status. In the given options, Option A would be considered a situation of legal employment discrimination. Rene, who has a disability, is rejected from a job position because another candidate did not have a disability. This is illegal under the Americans with Disabilities Act (ADA), which prohibits discrimination against qualified individuals with disabilities in regard to job application procedures, hiring, advancement, and other terms and conditions of employment.
Learn more about Employment Discrimination here:https://brainly.com/question/34396755
#SPJ6
PRO FORMA INCOME STATEMENT Austin Grocers recently reported the following 2016 income statement (in millions of dollars): Sales $700 Operating costs including depreciation 500 EBIT $200 Interest 40 EBT $160 Taxes (40%) 64 Net income $96 Dividends $32 Addition to retained earnings $64 For the coming year, the company is forecasting a 15% increase in sales, and it expects that its year-end operating costs, including depreciation, will equal 60% of sales. Austin's tax rate, interest expense, and dividend payout ratio are all expected to remain constant. What is Austin's projected 2017 net income? What is the expected growth rate in Austin's dividends?
Answer:
Net income = $169.2
Growth in dividend = 76.25%
Explanation:
The projected figures are as below:
Sales = $700 x (1 + 15%) = $805 (15% increase in sales)
Operating costs including depreciation = $805 x 60% = $483 (60% of sales)
Interest expense = 40 (remain constant)
EBIT = Sales - Operating costs including depreciation = $805 - $483 = $322
EBT = EBIT - Interest expense = $322 - $40 = $282
Net income = EBT x (1 - Tax rate) = $282 x (1 - 40$) = $169.2
Dividend = Net income x Dividend payout ratio = $169.2 x (32/96) = $56.4
Growth in dividend = $56.4/$32 = 76.25%
Which of the following statements is CORRECT?
Group of answer choices
A. When fixed assets are added in large, discrete units as a company grows, the assumption of constant ratios is more appropriate than if assets are relatively small and can be added in small increments as sales grow.
B. Firms whose fixed assets are "lumpy" frequently have excess capacity, and this should be accounted for in the financial forecasting process.
C. For a firm that uses lumpy assets, it is impossible to have small increases in sales without expanding fixed assets.
D. There are economies of scale in the use of many kinds of assets. When economies occur the ratios are likely to remain constant over time as the size of the firm increases.
E. The Economic Ordering Quantity model for establishing inventory levels demonstrates this relationship.
F. When we use the AFN equation, we assume that the ratios of assets and liabilities to sales (A0*/S0 and L0*/S0) vary from year to year in a stable, predictable manner.
Answer:
The correct answer is letter "B": Firms whose fixed assets are "lumpy" frequently have excess capacity, and this should be accounted for in the financial forecasting process.
Explanation:
Lumpy assets are assets that must be acquired in large-discrete units, not in small units. This causes excess capacity which is the situation in which the production is less than reachable for a firm. In the market, the demand is lower than what the firm could supply. This problem should be considered in a financial forecasting process to predict what the consequences could be in the long-term.
Madison Corporation sells three products (M, N, and O) in the following sales mix: 3:1:2. Unit price and cost data are: M N O Unit sales price $ 7 $ 4 $ 6 Unit variable costs 3 2 3 Total fixed costs are $340,000. The break-even point in composite units for the current sales mix (round to the nearest unit) is:
The break-even point in composite units for Madison Corporation based on the sales mix and provided cost data is 102102 units.
Explanation:The break-even point in composite units can be determined using the provided sales mix and the cost and price data for products M, N, and O from the Madison Corporation.
First, we calculate the contribution margin per unit for each product:
To find the weighted average contribution margin per composite unit based on the sales mix (3:1:2), we use the formula:
Weighted average contribution margin = (3*$4 + 1*$2 + 2*$3) / (3+1+2)
Weighted average contribution margin = ($12 + $2 + $6) / 6 = $20 / 6 = $3.33 (rounded to two decimal places)
Now, we calculate the break-even point in composite units by dividing the total fixed costs by the weighted average contribution margin per unit:
Break-even point in composite units = $340,000 / $3.33
Break-even point in composite units = 102102.10 units (rounded to nearest unit) = 102102 units
Learn more about Break-Even Point here:https://brainly.com/question/35967655
#SPJ12
The break-even point in: 1) Composite units = 17,000. 2) Individual units of products: - Product M = 85,000 units. - Product N = 170,000 units. - Product O = 113,333 units. 3) Total sales for the current sales ≈ $636,763.
To find the break-even point, we need to determine the total contribution margin and then divide the total fixed costs by the contribution margin per unit.
1) Composite Units:
Total contribution margin per composite unit = Total unit sales price - Total unit variable costs
= (3 × $7) + (1 × $4) + (2 × $6) - [(3 × $3) + (1 × $2) + (2 × $3)]
= $21 + $4 + $12 - ($9 + $2 + $6)
= $37 - $17
= $20.
Break-even point in composite units = Total fixed costs / Total contribution margin per composite unit
= $340,000 / $20
= 17,000 composite units.
2) Individual Units of Product:
To find the break-even point in individual units of each product, we first need to find the contribution margin per unit for each product:
- Product M: $7 - $3 = $4.
- Product N: $4 - $2 = $2.
- Product O: $6 - $3 = $3.
Now, we can find the break-even point for each product:
- Product M: $340,000 / $4 = 85,000 units.
- Product N: $340,000 / $2 = 170,000 units.
- Product O: $340,000 / $3 = 113,333 units.
3) Total Sales:
Total break-even sales = Total fixed costs / Contribution margin ratio
= $340,000 / ($20 / $37)
≈ $636,763.
So, the break-even point in:
1) Composite units = 17,000.
2) Individual units:
- Product M = 85,000 units.
- Product N = 170,000 units.
- Product O = 113,333 units.
3) Total sales ≈ $636,763.
The complete question is:
Madison Corporation sells three products (M, N, and O) in the following mix: 3:1:2. Unit price and cost data are:
Unit sales price: $7(M), $4(N), $6(O)
Unit variable costs: 3(M), 2(N), 3(O)
Total fixed costs are $340,000.
Required:
Determine the break-even point in:
1) composite units
2) individual units of product
3) total sales, for the current sales mix (round to the nearest unit).
On January 2, 2017, a calendar-year corporation sold 5% bonds with a face value of $2500000. These bonds mature in five years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $2292000 to yield 7%. Using the effective-interest method of computing interest, how much should be charged to interest expense in 2017?
Answer:
Consider the following explanation
Explanation:
Under Effective interest method, Interest calculated at the effective interest rate (i.e., the yield of the bond) is charged as an expense annually, and the payment made basis the Coupon rate.
In the given case, interest to be paid semi annually i.e, on June 30 and on December 31, will be $62,500 (i.e., 2,500,000 * 5% * 6/12).
On the basis of above, the interest expense to be charged in the 2017 can be calculated as follows: take a look to the attached archive.
As calculated above, the amount to be charged as interest expense for the year 2017 is (80,220 + 80,840 i.e.,) $ 161,060.
Which of the following will not increase the demand for hot dogs (i.e. which will not shift demand to the right)?
a. An expectation of a decline in the price of hotdogs in the future.
b. The price of hotdogs fall.
c. An increase in the price of substitute, such as hamburgers.
d. A decrease in the price of a complement, such as hotdog buns.
e. A celebrity effectively promotes the healthful attributes of hotdogs.
Answer:
b. The price of hotdogs fall.
Explanation:
The demand curve will shift to the right when the demand increases with an increase in demand due to change in factors other than the price.
A decline in the price of hotdogs can lead to an increase in quantity demanded but it does not shift the demand curve (increase demand). Instead, it moves along the curve. Conversely, changes in future price expectations, the price of substitute or complementary goods and effective marketing can shift the demand curve.
Explanation:In the context of economics, increasing the demand for a product means shifting the demand curve to the right. This refers to a scenario where, at any given price, the quantity demanded increases. The option that will not shift the demand for hot dogs to the right, out of the given choices, is - b. The price of hotdogs fall.
This is because a decrease in the price of hotdogs is a movement along the demand curve (quantity demanded change), not a shift of the demand curve. In contrast, options a, c, d, and e, which refer to future price expectations, price changes in substitute goods, price changes in complement goods, and effective marketing respectively, could all cause the demand curve to shift (demand change).
Learn more about Demand Curve here:https://brainly.com/question/37524165
#SPJ3
An architect is considering bidding for the design of a new shopping mall. The cost of drawing plans and submitting a model is $10,000. The probability of being awarded the bid is 0.12, and anticipated profits are $100,000, resulting in a possible gain of this amount minus the $10,000 cost for plans and a model. What is the expected value in this situation?
Answer:
The expected value is $2,000
Explanation:
The expected value in the following situation is computed as:
Expected value = Probability of bid × (Anticipated Profits - Cost of drawing plans) - (1 - Probability of bid) × Cost of drawing plans
where
Probability of bid is 0.12
Anticipated Profits is $100,000
Cost of drawing plans is $10,000
Putting the values above:
= 0.12 × ($100,000 - $10,000) - (1 - 0.12) × $10,000
= 0.12 × $90,000 - 0.88 × $10,000
= $10,800 - $8,800
= $2,000
The expected value in this situation is $10,800.
Explanation:To calculate the expected value in this situation, we need to multiply the profit by the probability of being awarded the bid. The profit is $100,000 minus the cost of $10,000, which is $90,000. The probability of being awarded the bid is 0.12.
Expected Value = Profit x Probability
Expected Value = $90,000 x 0.12
Expected Value = $10,800
Therefore, the expected value in this situation is $10,800.
Learn more about Expected value here:https://brainly.com/question/37190983
#SPJ3
Study abroad programs at universities worldwide promote the fact that they offer a unique opportunity for college students who appreciate diversity, are adventurous in spirit and enjoy new experiences. These students have a different outlook on life, compared to most college students. Based on this information, which form of segmentation has proven to be most useful to them in better understanding their audience?
a) Geographic
b) Demographic
c) Psychographic
d) Behavioral
e) All of the above
Answer: C. Psychographic
Explanation:
Psychograhic is the grouping of a population based on attitude , Interest and motivation, the demarcation in this scenario is based on students spirits, diversity and what they enjoy doing.
It's not a geographic demarcation because it's not based on physical boundaries or countries, it's not demographic because it's not based on natural factors such as ages, sex, etc . It's not based on equal consumption pattern and this makes it not to be behavioral and all the alternatives cannot be right because they are all different.
SilverFinn makes high-end jewelry for women. This jewelry is manufactured and patented in Italy. Manufacturers in Argentina create counterfeit SilverFinn jewelry and sell it in local markets at nearly similar prices to the original SilverFinn jewelry sold in other countries. This lack of intellectual property protection is like to result ina. reduction in export opportunities from Argentina to other countries.b. reduction in the export opportunities for SilverFinn jewelry in Argentina.c. expansion of the world market for SilverFinn products.d. reduction in import of all Argentinian goods.e. increase in the prices of jewelry produced by SilverFinn.
Answer:
b. reduction in the export opportunities for SilverFinn jewelry in Argentina
Explanation:
As there is a secondary market which erodes the trademark value of SilverFinn with counterfeit products; SilverFinn will find harder to export into Argentina as local market would prefer the local option as it is cheaper and will import other jewelry which do not have an alternative counterfeit market.
______________ did pioneering work on National Income Accounting at the NBER This was very important along with Wesley Mitchell's study of the Business Cycle and Milton Friedman's research on the demand for money..
A. Adam Smith
B. Joseph Schumpeter
C. Torstein Veblen
D. Simon Kuznets
Answer:
D. Simon Kuznets
Explanation:
Simon (Smith) Kuznets was born April 30, 1901 in Pinsk, Russian Empire (now Belarus), he was a Russian American economist and statistician and a 1971 Nobel Prize winner in Economics. In his work, he stressed the importance of making multiple observations, the limitation of simple models based on a single phase of historical experience, and the complexity of underlying economic data. According to Kuznets, in order for economic data to provide a healthy model, they should include information on the population structure, the nature of labor, the state structure, trade and markets. suggested. It also examines the cyclical changes in growth rates today called Kuznets cycles and their links to key factors such as population.
The National Bureau of Economic Research, founded in 1920, is a private, non-profit, non-partisan research organization designed to foster a deeper understanding of how the economy works. NBER seeks to conduct and disseminate objective economic research among government officials, business professionals, and the academic community. Over the years, the NBER research program has embraced a wide range of issues that our society faces. Early research focused on the overall economy, examining in detail the business cycle and long-term economic growth. Simon Kuznets’s pioneering work on national income accounting, Wesley Mitchell’s influential business cycle study, and Milton Friedman’s study of money demand and the determinants of consumer spending were among the first studies conducted by NBER.
In 1931, at the direction of Mitchell, Kuznets claimed responsibility for NBER's work on U.S. national income accounts. In 1934, the United States national income was estimated for the period 1929–1932; in addition, it was extended until 1919–1938, and then until 1869. Although Kuznets was not the first economist to try this, his work was so comprehensive and thorough that it set the standard in this area.
Kuznets managed to solve many problems, starting from a lack of information sources and bias estimates, and ending with the development of a theoretical concept of national income. Kuznets achieved high precision calculations. His work allowed us to analyze the structure of national income and identify for a detailed study a number of specific problems of the national economy. Improved methods for calculating national income and related indicators have become classics and formed the basis of the modern system of national accounts. After analyzing the distribution of income between different social groups, Kuznets hypothesized that in countries in the early stages of economic development, income inequality primarily increases, but as the national economy grows, it tends to decrease. This was Kuznets curve of “An empirical concept".
Now suppose that the government immediately pursues an accommodative policy by increasing government purchases in response to the short-run economic impact of the higher oil prices. In the long run, when the government pursues accommodative policy, the output in the economy will be $ billion and the price level will be
In response to an inflationary gap, the government can pursue an accommodative policy, which might include increasing government purchases, increasing taxes, or reducing expenditure. This would help shift the aggregate expenditure line, leading to a new equilibrium. In the long run, such actions can help the economy reach potential GDP without inflationary pressures.
Explanation:The question is about the effects of an accommodative policy in response to sharply increasing oil prices. Most likely, the economy is currently below its potential GDP, creating a gap caused by inflation.
In the long run, if the government increases purchases as part of an accommodative policy to address this inflationary gap, the economy's output may rise towards potential GDP, mitigating inflationary pressure. This can be achieved by shifting the aggregate expenditure line to a lower point (for example from AE to AE₁ in the provided figures), resulting in a new equilibrium point.
Such an accommodative policy approach is inspired by Keynesian economics. If the government either increases taxes on consumers or firms, or reduces government expenditure, this will also lead to a downward shift in aggregate spending, allowing the economy to operate at potential GDP without inflationary pressures.
Learn more about Accommodative Policy here:https://brainly.com/question/34879934
#SPJ11
Meacham Corp. wants to raise financing to purchase a competitor. It can issue 12 year bonds with a 9% annual coupon for $1090 and will incur debt flotation costs of $15 per bond.The company can sell additional equity shares to the public for $30 per share and estimates its equity flotation costs will be $3 per share. Meacham paid a $4 per share dividend yesterday and expects is dividends to grow 7% annually. The company is targeting a capital structure of 40% debt and 60% common equity and has a 35% marginal tax rate.Calculate the company's WACC.
Answer:
COST OF BOND
Year Cashflow DF@10% PV DF@5% PV
$ $ $
0 (1,075) 1 (1,075) 1 (1,075)
1-12 58.50 6.8137 399 8.8633 519
12 1,000 0.3186 319 0.5568 557
NPV (357) NPV 1
Kd = LR + NPV1/NPV1+NPV2 x (HR – LR)
Kd = 5 + 1/1 + 357 x (10 – 5)
Kd = 5 + 1/358 x 5
Kd = 5.01%
Ke = Do(1 +g)/Po-Fc + g
Ke = $4(1 + 0.07)/$30-$3 + 0.07
Ke = $4(1.07)/$27 + 0.07
Ke = 0.1585 + 0.07
Ke = 0.2285 = 22.85%
WACC = Ke(E/V) + Kd(D/V)
WACC = 22.85(60/100) + 5.01(40/100)
WACC = 13.71 + 2.004
WACC = 15.71%
Explanation:
In this question, we need to calculate cost of debt using IRR formula. The cashflow for year 0 is the current market price less floatation cost. The cashflow for year 1 to 12 is the after-tax coupon, which is calculated as R(1 -T). R = 9% x $1,000 = $90 and R(1 -T) = $90(1-0.35) = $58.50. The cashflow for year 12 is the par value. we will discount the cashflows so as to obtain the net present value.
We will also calculate cost of equity. which is a function of dividend paid, current market price and growth rate.
Finally, we will calculate the weighted average cost of capital by considering the cost of each stock and the proportion of each stock in the capital structure.
During 2017 sales on account were $866000 and collections on account were $522000. Also during 2017 the company wrote off $42500 in uncollectible accounts. An analysis of outstanding receivable accounts at year end indicated that bad debts should be estimated at $329000. The change in the cash realizable value from the balance at 12/31/16 to 12/31/17 was a
Answer:
There is a change of $27,500 (decrease)
Explanation:
Cash realizable value is the amount of money that the company expects to receive from their accounts receivable after deducting all uncollectible accounts.
First, we must compute the change in gross accounts receivable from the transactions happened during the year.
Sales on account less collections less write-offs = change in Gross accounts receivable.
$866,000 - ($522,000 + $42,500) = $301,500 (increase in gross accounts receivable)
Finally, we can now compute the change in cash realization value by deducting uncollectible accounts to gross accounts receivable.
$301,500 - $329,000 = ($27,500)
Gundy Company expects to produce 1,252,800 units of Product XX in 2017. Monthly production is expected to range from 72,200 to 110,400 units. Budgeted variable manufacturing costs per unit are: direct materials $3, direct labor $6, and overhead $11. Budgeted fixed manufacturing costs per unit for depreciation are $5 and for supervision are $1.In March 2017, the company incurs the following costs in producing 91,300 units: direct materials $303,900, direct labor $541,800, and variable overhead $1,010,300. Actual fixed costs were equal to budgeted fixed costs.Prepare a flexible budget report for March. (List variable costs before fixed costs.)
Answer:
See below.
Explanation:
Flexible budget is when per unit budgeted costs are reconciled with actual production volume.
Flexed Budget Costs
Direct Materials (91,300 * 3) $273,900
Direct Labor (91,300 * 6) $547,800
Overheads (91,300 * 11) $1,004,300
Manufacturing (91,300 * 5) $456,500
Supervision (91,300 * 1) $91,300
Total flexed Costs Budgeted $2,373,800
Hope that helps.
which of these is a reason why outsourcing continues to expand?
(A) more reliable transportation
(B) increased technological expertise
(C) rapid development and deployment of advancements in telecommunications and computers
(D) more expensive transportation
Answer:
The correct answer is letter "C": rapid development and deployment of advancements in automation.
Explanation:
Outsourcing is a business approach in which companies take their activities to different countries, rather than increasing their scale in the area where their headquarters are trying to reduce costs or meet regulations. This activity affects workers in the original country but is primarily a benefit to the countries in which companies start new operations.
Advances in software deployment, telecommunications and computers have improved outsourcing as it allows for the decentralization of information regardless of where organizations are involved and needs fewer qualified staff because most of the operations are conducted with the use of computers rather than employee expertise.
The increase in technological expertise and specialization is the reason why outsourcing continues to expand.
Outsourcing refers to the process where company passes its responsibility to a specialist company with the main aim of saving cost, improves service and efficiency etc
The method of Outsourcing are been considered by companies because advancement in technological in mass production and other purpose.
The technological specialization and its continued advancement is the reason why outsourcing is a viable operation and constantly expanding.
Therefore, the Option B is correct.
Learn more about this here
brainly.com/question/24766425
The main difference between a monopsonist and a competitive buyer of labor is that the competitor can hire as many workers as it wants at the going wage while the monopsonist must raise wages to hire additional workers. the monopsonist can hire as many workers as it wants at the going wage while the competitive firm must raise wages to hire additional workers. the competitive firm can hire as many workers as it wants at the going wage while the monopsonist can hire more workers at lower wages. the monopsonist can force wages down and still hire as many workers as it wants while the competitive firm must increase the wage rate to hire additional workers.
The main difference between a monopsonist and a competitive buyer of labor is that the competitor can hire as many workers as it wants at the going wage while the monopsonist must raise wages to hire additional workers.
Explanation:
There is a horizontal labour curve for a profitable consumer. Thus any number of jobs can be employed at a specified wage rate. The curve of labor supply for monopsonists is sloping upwards. Monopsonist must ,therefore pay higher wages to hire more employees.
Some examples of monopsonism relate to the buy in the labour market of workers ' time, in which a company is the only buyer of a particular kind of labor. The classical example of a natural monopoly is a mining company, where the mining company is the main employer and the primary employer in the city.
Sales $ 929,000 $ 264,000 $ 406,000 $ 259,000 Variable manufacturing and selling expenses 478,000 114,000 206,000 158,000 Contribution margin 451,000 150,000 200,000 101,000 Fixed expenses: Advertising, traceable 69,300 8,300 40,600 20,400 Depreciation of special equipment 42,900 20,300 7,200 15,400 Salaries of product-line managers 115,700 40,100 38,900 36,700 Allocated common fixed expenses* 185,800 52,800 81,200 51,800 Total fixed expenses 413,700 121,500 167,900 124,300 Net operating income (loss) $ 37,300 $ 28,500 $ 32,100 $ (23,300) Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out. Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes?
Answer:
Although the racing bikes is making a loss of $(23,300), by discontinuing the Racing Bikes, it will create financial disadvantage of $(101,000)
Explanation:
The financial advantages/(disadvantages) from discontinuing the Racing Bikes production is calculated as:
Plus: Cost saving = Variable contribution margin = $158,000
Less: Revenue deduction from not selling Racing Bikes = $259,000
Advantages/(Disadvantages) $(101,000)
In other words, by stopping Racing Bikes - a business line having positive Contribution Margin of $101,000, the company does not gain any further fixed cost saving or recovery of the sales of machines/ equipment used only for the Racing Bikes production, the discontinue will create a disadvantage equal to the contribution margin of the Racing Bike business line.
Tripp Corporation is planning to borrow $800,000 from its bank to pay one of its suppliers. The bank requires a compensating balance of 10%. Since Tripp currently holds no funds at the lending bank, it has borrowed enough to cover for the compensating balance as well. The amount that Tripp will pay its supplier is:
Answer:
$720,000
Explanation:
Data provided in the question:
Amount Tripp Corporation is planning to borrow = $800,000
Compensating balance required by the bank = 10%
Now,
Since out of the borrowed amount 10% is Compensating balance required by the bank
Therefore only 90% of the balance is available for the Tripp corporation to pay one of its suppliers
Thus,
Amount Tripp will pay its supplier will be
= 90% of the Amount Tripp Corporation is planning to borrow
= 0.90 × $800,000
= $720,000
Applying the direct write-off method to account for uncollectibles Shawna Valley is an attorney in Los Angeles. Valley uses the direct write-off method to account for uncollectible receivables. At April 30, 2018, Valley’s accounts receivable totaled $19,000. During May, she earned revenue of $22,000 on account and collected $15,000 on account. She also wrote off uncollectible receivables of $1,100 on May 31, 2018.
Answer:
The question is:
a. Journalize Valley's written off of the uncollectible receivables
b. What is the Account Receivables of Valley at May 31st 2018.
-----------
The answer is:
a.
31 May 2018
Dr Bad Debt expenses 1,100
Cr Account Receivables 1,100
( to written off of the uncollectible receivables)
b.
The balance of Account Receivables as at 31 May 2018: $24,900
Explanation:
a. Because direct written-off method is applied, the uncollectible amount is only recorded when it incurred rather than when it is foreseen. Bad debt expenses is debited and an offsetting credit is recorded straight into Account Receivables account ( instead of Provision for Uncollectible account).
b. The balance at end of May is calculated as:
Ending balance of April + Credit sales in May - Collection of credit sales in May - Uncollectibale amount recorded in May = 19,000 + 22,000 - 15,000 - 1,100 = $24,900.
The direct write-off method charges uncollectible accounts receivable directly to the expense account when deemed uncollectible. For Shawna Valley, a bad debt expense of $1,100 was recorded and her accounts receivable decreased by this same amount at the end of May 2018.
Explanation:The direct write-off method is an accounting practice used by businesses to deal directly with uncollectible accounts receivables. When a company determines that a specific account is uncollectible, the amount is charged directly to the expense account as a bad debt expense, which in turn reduces net income. The direct write-off method does not conform to the matching principle of accounting as expenses are not matched with the revenue generated in the same period.
In Shawna Valley's case, at the start of May 2018, her accounts receivable was $19,000. During May, she earned $22,000 in revenue on account and collected $15,000 in cash from accounts receivable. At the end of May, Valley wrote off $1,100 as uncollectible. The journal entry to reflect the write-off would be to debit Bad Debt Expense for $1,100 and credit Accounts Receivable for $1,100, thus directly reducing the accounts receivable balance.
Learn more about Direct Write-Off Method here:https://brainly.com/question/31858400
#SPJ3
Relationship-enhancing attributions involve which of the following factors?
A) Accurately identifying a partner's transgressions
B) Actor/observer effects
C) Giving credit for positive actions and excusing transgressions
D) Identifying one's own contributions to the relationship
Relationship-enhancing attributions involve Giving credit for positive actions and excusing transgressions.
Explanation:
Relationship-enhancing features happen when people place greater responsibility for the positive behavior on their relationships and less responsibility for the negative behavior of their partners.
If your partner brought you flowers, that's because he's sweet and sweet. But that's because he's caught in the traffic (something he wouldn't control when he's slow for a date).
In special relationship research, attributions are frequently divided into two classifications: attributions that "improve relationship" and attributions that "maintain distress" (Bradbury & Fincham, 1990), respectively.
Relationship-enhancing attributions involve giving credit for positive actions and excusing transgressions, which can help maintain a positive view of a partner.
Explanation:Relationship-enhancing attributions involve C) Giving credit for positive actions and excusing transgressions. This type of attribution reflects a tendency to view a partner's positive behaviors as intentional and as a reflection of their character, while negative behaviors are seen as circumstantial or situational. In contrast to relationship-enhancing attributions:
Actor/observer bias suggests that people attribute their own actions to situational factors while attributing others’ actions to their dispositions.Self-serving bias refers to the common habit of a person taking credit for positive events or outcomes, but blaming outside factors for negative events.The fundamental attribution error is the tendency to overemphasize personality traits and underestimate situational factors when explaining another's behavior.These biases and attribution errors can impact relationships, as they affect the way individuals perceive and react to each other's behaviors.
JackITs has 5.0 million shares of common stock outstanding, 1.0 million shares of preferred stock outstanding, and 20.00 thousand bonds. If the common shares are selling for $28.00 per share, the preferred share are selling for $13.50 per share, and the bonds are selling for 98.00 percent of par, what would be the weight used for equity in the computation of JackIT's WACC?
Answer:
80.88; 7.80; 11.32
Explanation:
Common Stock:
Value = Number × Price
= 5,000,000 × $28
= $140,000,000
Preferred Stock:
Value = Number × Price
= 1,000,000 × $13.50
= $13,500,000
Bonds:
Value = Number × Price
= 20,000 × $980
= $19,600,000
Total value = $140,000,000+ $13,500,000 + $19,600,000
= 173,100,000
Weight of common stock = Respective Value ÷ Total Value
= $140,000,000 ÷ 173,100,000
= 80.88
Weight of preferred stock = Respective Value ÷ Total Value
= $13,500,000 ÷ 173,100,000
= 7.80
Weight of Bonds = Respective Value ÷ Total Value
= $19,600,000 ÷ 173,100,000
= 11.32
Which products are considered "covered products" by the Treasury Department and are subject to anti-money regulations?A. Term life insuranceB. Health insuranceC. Whole life insuranceD. AnnuitiesE. Group life insurance
Answer:
The correct answers are letters "C" and "D": Whole life insurance; Annuities.
Explanation:
The Department of the Treasury defines "covered products" as permanent life insurance policy not applicable to group life insurance policies; annuity contracts that do not include group annuity contracts; and, other insurance products with monetary value or considered investments.
Under anti-money laundering laws outlined by the Treasury Department, 'covered products' include insurance policies such as whole life insurance and annuities that have cash value or investment features. However, term life insurance, health insurance, and group life insurance are typically not considered 'covered products'.
Explanation:According to the Treasury Department and provisions outlined under anti-money laundering regulations, certain insurance products are considered 'covered products.' The primary products considered under these regulations include permanent life insurance policies, other than group life insurance, annuities, and any other insurance products with features of cash value or investment. Therefore, out of the options given, whole life insurance (C) and annuities (D) are considered 'covered products' under these regulations. Term life insurance (A), health insurance (B), and group life insurance (E) are typically not included.
Learn more about Covered Products here:https://brainly.com/question/31971464
#SPJ3
During 2018​, Whisper Breeze Spa reported revenue of $20,000. Total expenses for the year were $15,000. Whisper Breeze Spa ended the year with total assets of $35,000​, and it owed debts totaling $15,000. At​ year-end 2017​, the business reported total assets of $30,000 and total liabilities of $ 15,000.
a. Compute Whisper Breeze Spa's net income for 2018.
Answer:
Whisper Breeze Spa's net income for 2018 is $5000.
Explanation:
Net income = Revenue - Total expenses
= $20000 - $15000
= $5000
Therefore, Whisper Breeze Spa's net income for 2018 is $5000.
To calculate the net income, subtract the total expenses from the total revenue. Using the figures provided for Whisper Breeze Spa, the net income for 2018 is $5,000 ($20,000 in revenue minus $15,000 in expenses).
Explanation:The net income for the year 2018 can be calculated by subtracting the total expenses from the total revenue. Whisper Breeze Spa reported a revenue of $20,000 and total expenses of $15,000 for the year 2018. By subtracting the total expenses from the total revenue, the net income for the year 2018 can be determined.
Net Income = Total revenue - Total expenses = $20,000 - $15,000 = $5,000.
So, Whisper Breeze Spa's net income for 2018 was $5,000.
Learn more about Net Income here:https://brainly.com/question/34630254
#SPJ3