Answer:
Price of Bond = $687.66
Explanation:
The value of the bond is the present value(PV) of the future cash receipts expected from the bond. The value is equal to present values of interest payment plus the redemption value (RV).
Value of Bond = PV of interest + PV of RV
The value of bond for Bank Mart Inc can be worked out as follows:
Step 1
Calculate the PV of interest payments
Annual interest payment
= 3%× 1000 = 30
PV of interest payment
PV = A× (1- 1+r)^(-n)
A- 30, r- 8%, n- 9
30× ((1-1.08^(-9))/0.08)=187.41
Step 2
PV of redemption Value
PV = RV × (1+r)^(-n)
RV - 1000, r- 8%, n- 9
PV of RV = 1000 × 1.08^(-9) = 500.24
Step 3
Price of bond
Total PV = 187.41 + 500.24 = $687.66
Price of Bond = $687.66
Which one of the following is NOT included in the Marketing Mix?
Select one:
a. Promotion
b. Product
c. Distribution
d. Price
e. Personalization
C : Distribution is not included in the marketing mix
If a municipality is expecting to receive federal funding for mass-transit programs, it could borrow against the expected funds to be received by issuing:_____.
A. BANs.
B. TANs.
C. GANs.
D. CLNs.
Answer:
Option C (GANs) is the correct answer.
Explanation:
GAN refers to "Grant Anticipation Notice". This can indeed be distributed by a municipality or community to "move forward" as well as make the proper use of another government grant extra funds expected future economic in the years ahead. Those other state grant monies are being used for investments in mass transportation, energy efficiency, including environmental regulations.The other three alternatives are not related to the given instance. So that the above would be the appropriate one.
In insurance, an offer is usually made wheN
Answer: the insurance application has been submitted.
Explanation:
Insurance is a contract which is typically represented by a policy, whereby an individual will receive financial protection in case there are losses against the thing that was insured.
Since the insurance is a contract, an offer can be made when there has been an application for the insurance which would have been submitted.
The problem with average-cost pricing regulation is that once it is in place, there is a tendency for the:________
a. ATC curve to shift upward.
b. MR curve to shift leftward.
c. D curve to shift leftward.
d. ATC curve to shift downward.
e. D curve to shift rightward.
Answer:
a. ATC curve to shift upward
Explanation:
Average cost pricing is a form of pricing that appears as one of the ways in which the government operates a monopoly market. The government, however, may utilize average cost pricing as a tool to oversee prices monopolists may charge.
In other words, this implies that Monopolists always incline to produce less than the optimal amount boosting the prices up.
Hence, the problem with average-cost pricing regulation is that once it is in place, there is a tendency for the: "Average Total Cost curve to shift upward." This can be a result of an increase in output and reduction price
Moped, Inc. purchased machinery at a cost of $44,000 on January 1, 2017. The expected useful life is 5 years and the asset is expected to have salvage value of $4,000. Moped depreciates its assets using the double-declining balance method. What is the firm's depreciation expense for the year ended December 31, 2017?
Answer:
Annual depreciation= $16,000
Explanation:
Giving the following information:
Purchase price= $44,000
Useful life= 5 years
Salvage value= $4,000
To calculate the depreciation expense under the double-declining balance, we need to use the following formula:
Annual depreciation= 2*[(book value)/estimated life (years)]
Annual depreciation= 2*[(44,000 - 4,000) / 5]
Annual depreciation= 16,000
A bond pays a semiannual coupon, and the last coupon was paid 61 days ago. If the annual coupon payment is $75, what is the accrued interest
Answer:
$12.57
Explanation:
Calculation for the accrued interest
Using this formula
Accrued interest =(Annual coupon payment/2) * (The numbers of days the last coupon was paid/182)
Note that Semiannual means the that annual coupon payment happened twice in a year which is from January to June and from July to December and Secondly let assumed that we have $182 days in the 6 months period.
Let plug in the formula
Accrued interest=(75/2) × (61/182)
Accrued interest=37.5*0.33516
Accrued interest=$12.57
Therefore the Accrued interest will be $12.57
In an emergency situation, such as a life-threatening trauma in an emergency room, a supervisor must be:_______.
a. sensitive to employees' feelings.b. an empathetic communicator.c. an apprehensive communicator.d. direct and assertive.
Answer:
d. direct and assertive.
Explanation:
In an emergency situation, such as a life-threatening trauma in an emergency room, a supervisor must be direct and assertive.
When there's an emergency situation, this ultimately implies a life and death situation which is typically characterized by having someone being in a very critical and dangerous condition. In order to be able to save such an individual or situations, it is very important and essential to have a direct and assertive supervisor who is in charge or control of the emergency situation and capable of making quick decisions that would most likely salvage the situation.
A supervisor who is assertive is confident, bold and positive about his or her instructions in any situation, which is a prerequisite quality to overcome emergencies.
Taunton's is an all-equity firm that has 152,000 shares of stock outstanding. The CFO is considering borrowing $245,000 at 6 percent interest to repurchase 21,000 shares. Ignoring taxes, what is the value of the firm
Answer:
The value of the firm is $1,773,333
Explanation:
Calculation of Value of each share
Amount borrowed (A) $245,000
No. of shares repurchased (B) 21,000
Value for each share (C) $11.67
No. of shares outstanding after repurchase(A) 131,000
(152,000 - 21,000)
Value for each share(B) $11.67
Equity value after repurchase(A*B) $1,528,333
Add: Amount borrowed $245,000
Firm value after this transaction $1,773,333
What is a commodity?
The correct answer is D. Something of value that can be bought, sold, or traded
Explanation:
The word "commodity" is used in economics to refer to any good or product that has an economic value and due to this, can be part of the market. This means any commodity can be traded, sold, or bought. Moreover, this concept is mainly applied to raw materials such as coal, timber, or wheat that can be used to make other manufactured products such as plastics, furniture, or flour. According to this, the option that correctly describes the word commodity is option D.
Answer:
D. Something of value that can be bought, sold, or traded
The following data relate to direct materials costs for February: Materials cost per yard: standard, $1.93; actual, $2.03 Standard yards per unit: standard, 4.68 yards; actual, 4.96 yards Units of production: 9,400 Calculate the direct materials price variance. a.$4,399.20 favorable b.$940.00 unfavorable c.$4,662.40 favorable d.$4,662.40 unfavorable
Answer:
d.$4,662.40 unfavorable
Explanation:
Calculation for direct materials price variance
The first step is to find the Actual quantity variance using the formula
Actual quantity variance =Actual units produced* Actual yard used
Let plug in the formula
Actual quantity variance=9,400*4.96 yards
Actual quantity variance=$46,624
Second step is to calculate for the Direct material price variance using this formula
Direct material price variance= ( Standard price -Actual price)* Actual quantity used
Let plug in the formula
Direct material price variance=($1.93-$2.03)*$46,624
Direct material price variance=(-0.1*46,624)
Direct material price variance=-$4,662.40 Unfavorable
Therefore the Direct material price variance will be $4,662.40 Unfavorable
It is January 2nd and senior management of Digby meets to determine their investment plan for the year. They decide to fully fund a plant and equipment purchase by issuing $10,000,000 in bonds. Assume the bonds are issued at face value and leverage changes to 2.7. Which of the following statements are true? Select all that apply.a. Working capital will remain the same at $18,964,118b.Total Assets will rise to $235,535,291c. Chesters' long-term debt will rise by $9,000,000d.The total investment for Chester will be $217,192,866e.Total liabilities will be $139,957,573
Answer:
Statements (b) and (e) are true.
Explanation:
According to the above, computation of the data given are shown below;
According to the statement (b), Total assets will rise to = $235,535,291
According to the statement (e) , Total liabilities will be $139,957,573
Also, according to the question, new liability amounts to = $10,000,000
Therefore,
Total Stockholder's Equity = Total assets - Total Liabilities
= $235,535,291 - $139,957,573 - $10,000,000
= $85,577,718
Leverage = Total Assets ÷ Total Stockholder's Equity
= $235,535,291 ÷ $85,577,718
= 2.7
According to the above analysis, statements (b) and (e) are true.
Answer :
b.Total Assets will rise to $235,535,291.
e.Total liabilities will be $139,957,573.
Explanation:
The following statements are true :
Working notes :
Total Assets = $235,535,291 Total Liabilities =$139,957,573 New Liability = $10,000,000Formula:
Total Stockholder's Equity = Total assets - Total Liabilities
Total Stockholder's Equity = $235,535,291 - $139,957,573 - $10,000,000
Total Stockholder's Equity = $85,577,718
Leverage = Total Assets ÷ Total Stockholder's Equity Leverage= $235,535,291 ÷ $85,577,718 Leverage= 2.7
According to the above scenario the correct answer is B and E.
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A small town with one hospital has two ambulances to supply ambulance service. Requests for ambulances during nonholiday weekends average .45 per hour and tend to be Poisson-distributed. Travel and assistance time averages two hours per call and follows an exponential distribution. Find:
a. System utilization.
b. The average number of customers waiting.
c. The average time customers wait for an ambulance.
d. The probability that both ambulances will be busy when a call comes in.
Explanation:
Given: -
The number of ambulances is(m) = 2.
Arrival rate = 0.45 per hour
Service time = 2 per hour
Service rate =?
service time = 2 (Travel and assistance time averages two hours per call)
Therefore, Service rate will be 1/2 = 0.5 per hour.
a). System utilization(p) = arrival rate/mean of ambulances*service time
p = 0.45/2×0.5 = 0.45.
(b) :- The average number of customer waiting or waiting time for an ambulance is equal to:-
Arrival rate divided by the service rate ( on its corresponding service time as per table value)
I.e. Arrival time = 0.45 ÷ service rate =0.5
= 0.9 ( see table value for 0.9 with service rate as 2)
It comes to 0.229.
Therefore, the average number of customers waiting. 0.229.
(c) :- The average time customers wait for an ambulance is equal to :
No. of customers waiting for ÷ arrival rate
0.229 ÷ 0.45 = 0.508
Or 0.509 (approx. )
D) probability of Both ambulances is idle is Po = 0.378 (from the table for the value of and M=2)
So Probability of both ambulance is busy = 1-Po
= 1 - 0.378
= 0.622
Wing CompanyCash- $234,000 Accounts payable- $97,000Inventories- $121,000 Notes payable (due 2020)- $211,000Land- $453,000 Accounts receivable- $46,000Refer to the information provided for Wing Company. Calculate current assets.a. $498,000b. $401,000c. $854,000d. $709,000
Answer:
b. $401,000
Explanation:
Currents assets refer to assets that are possible to be employed, exhausted, consumed, or sold withing a one year during the normal business activities of a company.
Current assets therefore include cash, cash equivalent and other assets that are expected to be changed to cash within one year.
From the question, we have;
Cash- $234,000
Accounts payable- $97,000
Inventories- $121,000
Notes payable (due 2020)- $211,000
Land- $453,000
Accounts receivable- $46,000
Therefore, current assets of Wing Company can be computed as follows:
Current assets = Cash + Inventories + Accounts receivable = $234,000 + $121,000 + $46,000 = $401,000
Therefore, the correct option is b. $401,000.
Product differentiation and advertising are profitable ventures only when:
the market is monopolistic
both revenues and costs increase
they do not affect entry barriers
the gain in total revenue outweighs the extra cost
the market is oligopolistic
Answer:
Product differentiation and advertising are profitable ventures only when:
the gain in total revenue outweighs the extra cost
Explanation:
When Company XYZ differentiates its product from competitors' through trademarks and other differentiating factors and embarks on advertising, it must watch out for cost overrun. The undertaking for the product differentiation and advertising should be able to generate more revenue than the costs. This will make Company XYZ determine that its differentiation and advertising make economic meaning by producing positive NPV.
Product differentiation as well as advertising can be considered as profitable ventures in a case whereby D: the gain in total revenue outweighs the extra cost.
Product differentiation can be regarded as activity that us been carried out by producer so that his product/service stand out to target audience. Advitisement on the other hand helps in promoting the goods/services .However, they a profitable ventures when the extra cost in production is less than the gain.Therefore, option D is correct.
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A machine with a cost of $133,000 and accumulated depreciation of $86,500 is sold for $53,000 cash. The amount that should be reported in the operating activities section reported under the direct method is:
Answer:
Zero, because the selling of fixed asset is reported as cash inflow under investing activity.
Explanation:
Cash flow from investing activities includes all the investments in the long term assets and sale of investments or individual assets. The investment items may include Property, Plant and Equipment.
So this means that it will not be included in the Cash from Operating Activities because it is a Cash from Investing Activities.
You want to save $98,000 to buy an boat by making an equal, end of year payment into a brokerage account for the next 9 years. If you expect to earn an annual interest rate of 7.75% on your account, how much do you need to deposit each year into your account?
Answer:
Annual deposit= $7,930.11
Explanation:
Giving the following information:
FV= $98,000
n= 9 years
i= 0.0775
To calculate the annual deposit, we need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (98,000*0.0775) / [(1.0775^9) - 1]
A= $7,930.11
Answer: $7,930
Explanation:
The payments are to be equal so this is an annuity. The expected value is to be $98,000 in 9 years so this is a future value of an Annuity.
The formula is;
FV = [tex]P * \frac{[1 + i]^n-1}{i}[/tex]
98,000 = [tex]P * \frac{[1 + 0.075]^9-1}{0.075}[/tex]
98,000 = P * 12.3581
P = 98,000/12.3581
P = $7,930
A company budgets administrative salaries at $5,000 at a sales level of 1,000 units. At a sales level of 1,200 units, budgeted administrative salaries will be $
Answer:
$5,000
Explanation:
Based on the information given we were told that the company had budgets administrative salaries at the amount of $5,000, which means that the amount of $5,000 will be the company budgets administrative salaries.
Therefore the company budgeted administrative salaries will be the amount of $5,000
In the Solow model with constant technological knowledge (A), if the economy is initially below its steady-state capital stock:
Answer: catching up growth will occur
Explanation:
In the Solow model with constant technological knowledge (A), if the economy is initially below its steady-state capital stock,. catching up growth will occur.
This is because, we are informed in the question that the Solow model has a constant technological knowledge. This implies that no innovation took place for that period, hence, the catching up growth will occur.
You have a $46,000 portfolio consisting of Intel, GE, and Con Edison. You put $20,800 in Intel, $10,400 in GE, and the rest in Con Edison. Intel, GE, and Con Edison have betas of 1.3, 1, and .8, respectively. What is your portfolio beta? Multiple Choice 1.071 0.976 0.824 1.393
Answer: 1.071
Explanation:
The portfolio beta is the weighted average of the constituent stock betas.
Intel Weight
= 20,800/46,000
= 0.45217
GE Weight
= 10,400/46,000
= 0.22609
Con Edison
= (46,000 - 20,800 - 10,400) / 46,000
= 0.32174
Portfolio Beta;
= (0.45217 * 1.3) + (0.22609 * 1) + (0.32174 * 0.8)
= 0.587821 + 0.22609 + 0.257392
= 1.071303
= 1.071
Which of the following statement is NOT TRUE about advantages of using primary data?
А. The researchers can decide the type of method they will use in collecting the data
B. The researchers can focus the data collection on specific issues of the research. С. The researchers would know in detail how the data were gathered and will be able to present original data.
D. The researchers will have to collect large volume of data since they will interact with different people and environments.
Answer:
A. false
B. false
C. true
D. true
A company is considering replacing an old piece of machinery, which cost $400,000 and has $175,000 of accumulated depreciation to date, with a new machine that has a purchase price of $550,000. The old machine could be sold for $250,000. The annual variable production costs associated with the old machine are estimated to be $72,500 per year for eight years. The annual variable production costs for the new machine are estimated to be $24,000 per year for eight years.
Required:
a. Prepare a differential analysis dated May 29 to determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine.
b. What is the sunk cost in this situation?
Answer:
Company A
a. Differential Analysis dated May 29
Alternative 1 Alternative 2
Opportunity cost $250,000 $550,000
Variable production costs 580,000 192,000
Total cost $830,000 $742,000
b. Sunk cost in this situation is: $225,000 ($400,000 - $175,000) cost of the old machine.
Explanation:
Company A's relevant cost for the old machine is the opportunity cost that it will lose if it continues with Alternative 1 or continued use of the old machine and the additional cost for the new machine for Alternative 2. Also relevant is the variable production costs that would be incurred if the old or new machine is used.
Company A's sunk cost is the cost of the old machine minus accumulated depreciation. Sunk cost is not relevant for decision making under differential analysis.
Company A's differential analysis is a managerial tool that is used to differentiate one decision alternative from another. In this analysis, only relevant costs are considered. A relevant cost in this case is cost that its inclusion or elimination makes a difference in the decision outcome.
You sold ten put contracts on Cross Town Bank stock at an option price per share of $0.85. The options have an exercise price of $39 per share. The options were exercised today when the stock price was $34 a share. What is your net profit or loss on this investment assuming that you closed out your positions at a stock price of $34
Answer:
-$4,150
Explanation:
Calculation to determine your net profit or loss on this investment
Using this formula
Net profit/Loss=(Option price per share-Exercise price+Stock price)×100×10
Let plug in the formula
Net loss = ($0.85 - $39 + $34) × 100 × 10
Net loss =-$4.15×100×19
Net loss = -$4,150
Therefore your net loss on this investment is -$4,150
Indicate the type of Deferred Tax account created by Unearned Revenues and Prepaid Expenses, respectively:
Answer:
The answer is Deferred tax asset and Deferred tax liability.
Explanation:
Unearned revenue creates deferred tax asset. In here, taxes have been paid because income has been received but have not been recognized on the income statement because according to the revenue recognition, the services for the revenue has not been rendered.
Prepaid expenses give rise to deferred tax liability. In here, taxes have been recognized on income statement but the actual tax has not been paid. Income tax expense on income statement is greater than taxes payable
A group of workers normally consists of 60 men, 30 women and 20 boys. They are paid at standard hourly rates as under:
Men Rs. 280.00
Women Rs. 160.00
Boys Rs. 140.00
In a normal working week of 40 hours, the group is expected to produce 5,000 units of output.
During the week ending on March 21, 2021 the group consisted of 70 men, 25 women, and 25 boys. The actual wages paid were Rs. 270, Rs. 165 and Rs. 130 respectively. 4,500 units were produced.
The Company is using Flexible Budgeting.
Calculate:
2(a) Labour cost variance
2(b)Labour rate variance
2(c) Labour efficiency variance
Given:
Standard Number of men = 60
Standard Number of women = 30
Standard Number of boys = 20
Standard hour rate for men = R.s 280
Standard hour rate for women = R.s 160
Standard hour rate for boys = R.s 140
Weekly working hour = 40 hours
Expected unit = 5,000 units
Number of men in march week = 70
Number of women in march week = 25
Number of boy in march week = 25
Actual wage for men = R.s 270
Actual wage for women = R.s 165
Actual wage for boys = R.s 130
Actual units = 4,500 units
Find:
Labour cost varianceLabour rate varianceLabour efficiency varianceComputation:
Labour cost variance = [SC for AO] - AC
Labour cost variance = [( 70 × 280) + (25 × 160) + (25 × 140)] - [(70 × 270) + (25 × 165) + (25 × 130)] × 40
Labour cost variance = (27,100 - 26,275 ) × 40
Labour cost variance = R.s 33,000 (F)
Labour rate variance = (SR - AR) × AH worked
Labour rate variance = [(280 - 270)70 + (160 - 165)25 + (140 - 130)25]40
Labour rate variance = [700 - 125 + 250]40
Labour rate variance = [825]40
Labour rate variance = R.s 33000 (F)
Labour efficiency variance = (SH allowed - AH worked)SR
Labour efficiency variance = (0 - 0)SR
Labour efficiency variance = 0
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f the nominal interest rate is 7 percent and the real interest rate "is -2.5" percent, then the inflation rate is
Answer:
9.7%
Explanation:
(1 + nominal interest rate) = (1 + real rate) x (1 + inflation rate)
1.07 = 0.975 x (1 + inflation rate)
(1 + inflation rate) = 1.07 / 0.975
(1 + inflation rate) = 1.097
Inflation rate = 1.097 - 1 = 0.097 = 9.7%
Identifying the Difference Between Risk and Threat Types of Threateners
Answer:
peligro es una cosa peligroso es otra peligrosisimo es otrisima
Explanation:
A buyer properly revokes the offer after receiving the property condition disclosure and requests the return of the buyer's earnest money the principal broker is holding in a ____________ trust account. The PREB (1) may require the buyer to sign a release before returning the money; (2) must obtain the seller's permission before returning the money.
Answer:
1. Clients'
2. The principal real estate broker (PREB) may require the buyer to sign a release before returning the money.
Explanation:
In this scenario, a buyer properly revokes the offer after receiving the property condition disclosure and requests the return of the buyer's earnest money the principal broker is holding in a clients' trust account. The principal real estate broker (PREB) may require the buyer to sign a release before returning the money.
Additionally, a principal real estate broker (PREB) can be defined as an individual who is licensed to individually provide a professional real estate service or work with other licensed brokers.
The amount of money being paid to a broker by a buyer as an initial payment to sign a purchase agreement letter is referred to as the earnest money. A principal real estate broker collects the earnest money from a buyer on behalf of the seller of a property such as land, buildings etc.
Hankins, Inc., is considering a project that will result in initial aftertax cash savings of $5.3 million at the end of the first year, and these savings will grow at a rate of 3 percent per year indefinitely. The firm has a target debt-equity ratio of .52, a cost of equity of 13.2 percent, and an aftertax cost of debt of 6.6 percent. The cost-saving proposal is somewhat riskier than the usual project the firm undertakes; management uses the subjective approach and applies an adjustment factor of 1 percent to the cost of capital for such risky projects.Required:a. Calculate the WACC.b. What is the maximum cost the company would be willing to pay for this project?
Answer:
a.
WACC - Company = 10.94%
WACC - Project = 11.94%
b.
The maximum that the company will be willing to pay for this project is $61.0626 million
Explanation:
a.
To calculate the maximum cost that the company will be willing to pay today, we first need to find out the company and project WACC.
The WACC or weighted average cost of capital is the cost of a company's capital structure. It is calculated as follows,
WACC = wD * rD * (1 - tax rate) + wP * rP + wE * rE
Where,
d, p and e represents debt, preferred stock and common equityw represents the weight of each componentr represents the cost of each componentWeightage of debt and equity
Total assets = debt + equity
Total assets = 0.52 + 1 = 1.52
wD = 0.52/1.52
wE = 1/1.52
WACC - Company = 0.52/1.52 * 0.066 + 1/1.52 * 0.132
WACC - Company = 0.1094 or 10.94%
WACC of project is 1% more than WACC of company. So WACC of project is 10.94% + 1% = 11.94%
b.
The maximum that must be paid for this project can be calculated by calculating the present value of the cash flows provided in form of saving by this project.
Using the constant growth model of cash flow approach,
Present value = 5.3 * (1+0.03) / (0.1194 - 0.03)
Present value = $61.0626 million
Bailey and Sons has a levered beta of 1.10, its capital structure consists of 40% debt and 60% equity, and its tax rate is 40%. What would Bailey's beta be if it used no debt, i.e., what is its unlevered beta? a. 0.79 b. 0.67 c. 0.71 d. 0.64 e. 0.75
Answer:
Option A. 0.79
Explanation:
All we have to do is convert the levered beta into unlevered beta (100% equity financed). So we will use the following formula to find unlevered beta:
Unlevered Beta = Levered Beta / (1 + (1+T)* D/E)
Here,
Tax rate is 40%
Debt is 40%
Equity is 60%
And Levered Beta is 1.10
Now by putting values, we have:
Unlevered Beta = 1.10 / (1 + (1 - 0.4)* 40% / 60%)
Unlevered Beta = 1.10 / (1 + 0.6 * .667)
Unlevered Beta = 1.10 / (1 + 0.4)
Unlevered Beta = 1.10 / (1.4)
Unlevered Beta = 0.786 which after rounding off we have 0.79
If a company would still have a cash flow item even if they rejected potential new Project A, should this particular cash flow item be included in Project A's cash flow analysis?
Answer: No
Explanation:
When computing a project analysis for a project, only relevant cash flow should be included in the Project's cash flow analysis. Relevant cash-flow are those that will only occur if the project was embarked on.
If the cash flow in question is still going to occur even if the project wasn't initiated as is the case with Project A, it is not a relevant cash-flow and should not be included in the cash-flow analysis.