Answer:
Correct Answer:
1. True
Explanation:
Taxes affect work activity directly through labor supply-and-demand channels and indirectly through government spending responses to available tax revenues. It has been determined that higher tax rates on labor lead to less work time in the legal market sector.
Suppose the real risk-free rate is 3.50%,the average future inflation rate is 2.50%, a maturity premium of 0.20% per year to maturity applies, i.e., MRP = 0.20%(t), where t is the years to maturity. Suppose also that a liquidity premium of 0.50% and a default risk premium of 0.80% applies to A-rated corporate bonds.
Required:
What is the difference in the yields on a 5-year A-rated corporate bond and on a 10-year Treasury bond?
Answer:
the 5 year A-rated corporate bond yields 0.3% more than the 10-year Treasury bond
Explanation:
the yield of a 10 year treasury bond = real risk free rate + average future inflation rate + (maturity premium x number of years) = 3.5% + 2.5% + (20% x 10 years) = 8%
the yield of a 5 year A-rated corporate bond = real risk free rate + average future inflation rate + liquidity premium + default risk premium + (maturity premium x number of years) = 3.5% + 2.5% + 0.5% + 0.8% + (20% x 5 years) = 8.3%
difference in yields = 8.3% - 8% = 0.3%
Some 150 million customers a month visit Amazon and the company passes through $160 billion in sales via its global supply channels and partnerships making interorganizational relationships very important to the company. Which interacting organization has a low coordination, low integration, transactional focus
Answer with Explanation:
Amazon is fastest growing company in the world which has crossed 2 billion customer visits. It has also increased the worth of the company to $1.14 trillions. The supply chain management is where the strengths of the company lies and nobody can match the pricing strategy, quality management and other significant factors that are included in the supply chain management to ensure that the customer is having what they are paying for.
Supply chain management process includes the key partners which includes their suppliers, partners, clients and customers as well who play important roles in the supply chain process by coordinating, integrating systems with each other and are involved in the transaction-al process.
The customers are the one who interact fewer than partners, suppliers, clients, etc because all they do is order a particular product. This is the first interaction of the customer with Amazon and the last interaction is when the customer received the order. So this means they are less interacting party in this process.
Suppliers are continuously contacted and informed about the pricing, supply chain issues, etc so that the company is able to deliver its customers what they are desiring. Supply chain partners also in the process of interacting with Amazon as they have to move products from supplier to the customer. These partners are highly interacted, possess integrating systems and of transaction-al importance to the company.
The Matterhorn Corporation is trying to choose between the following two mutually exclusive design projects:
Year Cash Flow (I) Cash Flow (II)
0 –$87,000 –$55,000
1 36,900 11,700
2 47,000 34,500
3 27,000 28,500
Requirement 1:
(a) If the required return is 10 percent, what is the profitability index for each project? (Do not round intermediate calculations). Round your answers to 3 decimal places.
(b) If the required return is 10 percent and the company applies the profitability index decision rule, which project should the firm accept?
Requirement 2:
(a) If the required return is 10 percent, what is the NPV for each project? (Do not round intermediate calculations. Round your answers to 2 decimal places .
Answer:
PI for the first project = 1 + ($5,673.93 / 87,000) = 1.065
PI for the second project = 1 + ($5,561.23 / $55,000) = 1.101
b. the second project should be chosen because the PI is higher
NPV for 1 = $5,673.93
NPV for 2 = $5,561.23
Explanation:
profitability index = 1 + (NPV / Initial investment)
Net present value is the present value of after tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator
for the first project
Cash flow in year 0 = –$87,000
Cash flow in year 1 = 36,900
Cash flow in year 2 = 47,000
Cash flow in year 3 = 27,000
I = 10%
NPV = $5,673.93
for the second project
Cash flow in year 0 = –$55,000
Cash flow in year 1 = 11,700
Cash flow in year 2 = 34,500
Cash flow in year 3 = 28,500
I = 10%
NPV = $5,561.23
PI for the first project = 1 + ($5,673.93 / 87,000) = 1.065
PI for the second project = 1 + ($5,561.23 / $55,000) = 1.101
b. the second project should be chosen because the PI is higher
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
Assume that the CEO of a company gave you the project charter specifying your authority, among others to work on an initiative providing health services to the community in a certain neighborhood. Before the company embarked on the project, the team analyzed the health sector development program of the country and read through laws the country enacted regarding the health sector. It also did a market survey to solicit information as to who does what. From the analysis, it learned that several companies where engaged in the provision of solar energy. As it did not want to be engaged in providing the same service that others were offering, it started developing solar powered mobile clinic. With an initial outlay of birr 5 Million, the project would last for 7 years. Since the whole work was too huge to consider all at once, the project manager and the team decomposed the project into manageable compartments and then to activities. It also developed schedule, set standards, and anticipated possible bottlenecks along the way. From the analysis it made, it found out that there would be a 20% chance that medical supplies would be delivered late costing the company ETB 350,000. There would also be a 40% chance that the company would save ETB 175,000 in time as it would build the component using already existing templates instead of starting from scratch. Finally, the team would like to make sure that the work would satisfy all of the requirements so that it would get the acceptance of the clients. 1. Characterize a project based on the above narration and distinguish the project manager from an operations manager? 2. What is the Expected Monetary Value for the two possibilities? What would you suggest as a solution to respond to risks? 3. Mention and elaborate the input the company used to develop products using templates already existing instead of starting from the scratch. 4. What are the areas of expertise indicated in the story? 5. If you were to produce documents thereby convince stakeholders to buy in the project idea, what would you do for a successful initiation? 6. Discuss the processes, process groups and knowledge areas narrated in the story.
Answer:
Characterize a project based on the above narration and distinguish the project manager from an operations manager?
Explanation:
A factory costs $400,000. It will produce an inflow after operating costs of $100 000 in year 1. $ 200,000 in year 2, and $ 300,000 in year 3. The opportunity cost of capital is 12%. Calculate NPV.
Answer:
NPV = $62,258.56
Explanation:
initial outlay year 0 = $400,000
cash inflow year 1 = $100,000
cash inflow year 2 = $200,000
cash inflow year 3 = $300,000
discount rate = 12%
using a financial calculator, NPV = $62,258.56
if you do it by hand:
NPV = -$400,000 + $100,000/1.12 + $200,000/1.12² + $300,000/1.12³ = -$400,000 + $89,285.71 + $159,438.78 + $213,534.07 = $62,258.56
e. Assume that the average price of a new home is $132,500. If new homes are increasing at a rate of 8% per year, how much will a new home cost in seven years? (Round your answer to 2 decimal places.)
Answer:
A new home will cost $227081.72 in seven years.
Explanation:
To calculate the value or price of the new home in seven years, we need to calculate the future value of $132500 increasing at a rate of 8% per year for 7 years. The formula to calculate the future value will be,
Future value = Present value * (1+r)^t
Where,
r is the rate which will be used for compoundingt is the time in number of yearsFuture value = 132500 * (1+0.08)^7
Future value = $227081.7156 rounded off to $227081.72
_____is the function of coordinating the diverse activities and human resources of a company to produce a smooth-running operation.
a) planning.
b) directing.
c) controlling.
d) accounting.
Answer:
b) directing
Explanation:
The four main management functions are:
planningorganizingdirectingcontrollingOriginally, there were 5 main management functions developed by Henri Fayol (staffing was the fifth one) in the early 20th century. Fayol's management theory is still applied today, although it has been modified and updated.
Monetary stimulus is only helpful to an economy: __________
a. experiencing significant negative externalities.
b. that's in recession.
c. with few public goods.
Suppose the firms in a perfectly competitive industry merge to form a monopoly. Which of the following would NOT occur?
a. A rise in total consumer plus producer surplus
b. A deadweight loss
c. A rise in producer surplus
d. A fall in consumer surplus
Answer: a. A rise in total consumer plus producer surplus
Explanation:
When a Monopoly is formed, the Producer surplus will increase but the Consumer surplus will decrease. This is because a Monopoly will charge a higher price than a Competitive firm to get more profit as well reduce output as well.
This will result in the transfer of some Consumer surplus to the Producer as well as a Dead-weight loss being formed thereby reducing the Consumer surplus. The total surplus will therefore fall as a result of this merger.
On February 1, 2020, Pat Weaver Inc. (PWI) issued 9%, $1,200,000 bonds for $1,500,000. PWI retired all of these bonds on January 1, 2021, at 105. Unamortized bond premium on that date was $126,000. How much gain or loss should be recognized on this bond retirement
Answer: Gain on bond retirement = $66,000
Explanation:
A gain on retirement of bonds occurs when a bond issuer or a corporation buys back bonds which it previously sold for an amount less than the book value of the particular liability while a loss would be recognized if the bought back bonds are more than the amount of the book value of the liability.
Book value / Carrying value = $1,200,000 + $126,000 =$1,326,000
paid at redemption = $1,200,000 x 105%= $1, 260,000
Gain on bond retirement = Book/ Carrying value -Amount paid at redemption
= $1,326,000 - $1, 260,000 = $66,000
Coffer Co. is analyzing two potential investments.
Project X Project Y
Cost of machine $77,000 $55,000
Net cash flow:
Year 1 28,000 2,000
Year 2 28,000 25,000
Year 3 28,000 25,000
Year 4 0 20,000
If the company is using the payback period method and it requires a payback of three years or less, which project(s) should be selected?
a. Project Y
b. Both X and Y are acceptable projects.
c. Project Y because it has a lower initial investment
d. Project X
e. Neither X nor Y is an acceptable project
Answer:
d. Project X
Explanation:
For Project X
Year Net cash outflow Net cash inflow Balance
0 -$77,000 -$77,000
1 $28,000 -$49,000
2 $28,000 -$21,000
3 $28,000 $7,000
4 0 $7,000
Payback period = 2 + $21,000 ÷ $28,000
= 2 + 0.75
= 2.75 years
For Project Y
Year Net cash outflow Net cash inflow Balance
0 -$55,000 -$55,000
1 $2,000 -$53,000
2 $25,000 -$28000
3 $25,000 -$3,000
4 $20,000 $17,000
Payback period = 3 +3,000 ÷ 20,000
= 3 + 0.15
= 3.15 years
Project X has a lesser than 3 year payback period. So, the correct option is D
A sole proprietor owned an office building with a cost of $300,000 and accumulated depreciation of $40,000, using modified accelerated cost recovery system (MACRS) straight-line depreciation. In the current year, she sold the building for $320,000. What is the unrecaptured Section 1250 gain from this sale, if any
Answer:
The Correct Answer:
$40,000
Explanation:
IRC Section 1250 requires that excess depreciation (actual depreciation in excess of straight-line depreciation) be recaptured as ordinary income. Since the property has sold for more than the adjusted basis ($300,000 − $40,000 = $260,000 adjusted basis), the initial gains are recaptured based on the original purchase price of $300,000.
This makes the first $40,000 of the profit subject to the unrecaptured Section 1250 gain while the remaining $20,000 is considered regular long-term capital gains.
Compared to countries with less economic freedom, countries with more economic freedom achieve higher per person income levels, but they also have higher poverty rates.grow more rapidly, but the income levels of the poor are largely unaffected by the higher growth rates of the freer economies.achieve both higher income levels per person and lower rates of poverty.grow less rapidly and experience higher poverty rates.
Answer:
The correct answer is: Achieve higher per person income levels, but they also have higher poverty rates.
Explanation:
What happens is that in countries with greater economic freedom, there is the free market, which is an economic form of the capitalist system that allows trade to be conducted free of external forces, being guided by the law of supply and demand. This system allows greater economic interaction with internal and external economic agents whose main objective is to generate profits.
The strong industrialization resulting from the capitalist system causes the greatest economic growth in a country and can increase the levels of per capita income, but it also generates greater social inequality that directly affects the growth of poverty rates. Generally, the main indicators of economic growth, such as GDP, have some limitations to indicate the distribution of wealth because they do not consider variables that include the well-being of the population.
Provided other eligibility requirements are met, who is eligible for Medicare?
Answer:
Generally, Medicare is available for people age 65 or older, younger people with disabilities and people with End Stage Renal Disease (permanent kidney failure requiring dialysis or transplant). You or your spouse had Medicare-covered government employment.
Myers, Inc.
Income Statement
For the Year Ended December 31, 2020
Sales revenue $400,000
Cost of goods sold 180,000
Gross profit 220,000
Expenses (including $10,000 interest and $20,000 income taxes) 80,000
Net income $ 140,000
Additional information:________.
1. Common stock outstanding January 1, 2020, was 16,000 shares, and 24,000 shares were outstanding at December 31, 2020.
2. The market price of Myers stock was $9.59 in 2020.
3. Cash dividends of $19,600 were paid, $3,000 of which were to preferred stockholders.
Compute the following measures for 2020. (Round Earnings per share to 2 decimal places, e.g. 1.65, and all other answers to 1 decimal place, e.g. 6.8 or 6.8%.)
(a) Earnings per share $
(b) Price-earnings ratio times
(c) Payout ratio %
(d) Times interest earned times
Answer:
a. $6.85
b. 1.4 times
c. 11.9%
d. 17 times
Explanation:
a) Weighted Average number of common shares outstanding = (Number of common shares outstanding in the beginning + Number of common shares outstanding in the end)/2
= (16,000 +24,000) /2
= 20,000 shares
Earnings per share = (Net income – Preferred stock dividend)/Weighted Average number of common shares outstanding
= (140,000 - 3,000) / 20,000
= 137,000/20,000
= $6.85
b) Price earnings ratio = Market price of 1 common share/Earnings per share
= 9.59 / 6.85
= 1.4 times
c) Payout ratio = Cash dividends on common stock/Net income
= 16,600 / 140,000
= 0.11857
= 11.9%
d) Times interest earned = (Net income + Interest expense + Tax expense) / Interest expense
= (140,000 + 10,000 + 20,000)/10,000
= 170,000 / 10,000
= 17 times
If $4000 is borrowed at a rate of 4.75% interest per year, compounded quarterly, find the amount due at the end of the given number of years. (Round your answers to the nearest cent.)
Answer:
1. $4000(1 + 4.75/4)^20 = $5,065.21
2. $4000(1 + 4.75/4)^28 = $5,566.88
3. $4000(1 + 4.75/4)^36 = $6,118.25
Explanation:
Here is the full question :
f $4000 is borrowed at a rate of 4.75% interest per year, compounded quarterly, find the amount due at the end of the given number of years. (Round your answers to the nearest cent.)
5 Years
7 Years
9 Years
We are to find the future value of the amount
The formula for calculating future value:
FV = P (1 + r/m)^ nm
FV = Future value
P = Present value
R = interest rate
N = number of years
M = number of compounding per year
1. $4000(1 + 4.75/4)^20 = $5,065.21
2. $4000(1 + 4.75/4)^28 = $5,566.88
3. $4000(1 + 4.75/4)^36 = $6,118.25
Eleanor spends all of her money on magazines and donuts. In 2014, she earned $14.00 per hour, the price of a magazine was $7.00, and the price of a donut was $1.00.
Which of the following give the nominal value of a variable?
A. Eleanor's wage is $14.00 per hour in 2014.
B. The price of a donut is $1.00 in 2014.
C. Eleanor's wage is 2 magazines per hour in 2014.
Which of the following give the real value of a variable?
A. Eleanor's wage is 14 donuts per hour in 2014.
B. The price of a magazine is 7 donuts in 2014.
C. Eleanor's wage is $14.00 per hour in 2014.
Suppose that the Fed sharply increases the money supply between 2014 and 2019. In 2019, Eleanor's wage has risen to $28.00 per hour. The price of a magazine is $14.00 and the price of a donut is $2.00.
In 2019, the relative price of a magazine is ________.
Between 2014 and 2019, the nominal value of Eleanor's wage ______, and the real value of her wage _________.
Monetary neutrality is the proposition that a change in the money supply nominal variables and _______ real variables.
Answer;
1. A. Eleanor's wage is $14.00 per hour in 2014.
B. The price of a donut is $1.00 in 2014.
When a variable is stated in nominal terms, it is usually given as a fixed monetary value because it is not adjusted for inflation. It therefore mentions just the price as is.
2. A. Eleanor's wage is 14 donuts per hour in 2014.
B. The price of a magazine is 7 donuts in 2014.
When goods are described in real terms, they are related to another good in order to adjust them for inflation.
3. The price of a magazine is $14.00 and the price of a donut is $2.00.
In 2019, the relative price of a magazine is 7 donuts.
The relative price = Price of Magazine/ Price of donuts
= 14/2
= 7 donuts.
4. Between 2014 and 2019, the nominal value of Eleanor's wage increases, and the real value of her wage remains the same.
As a result of the increase in money supply, Eleanor's wages increased nominally from $14 to $28.
However, in real terms her wages did not increase at all because the price level in the economy increased by the same rate that her wages increased meaning that she is still only able to buy the same quantity of things.
5. Monetary neutrality is the proposition that a change in the money supply affects nominal variables and does not affect real variables.
From Eleanor's example above, the concept of Money Neutrality is shown in that while a change in money supply will affect nominal variables, it will not affect real variables due to a general rise in prices.
Location Score
Factor
(100 points each) Weight A B C
Convenience .15 86 77 83
Parking facilities .20 70 88 98
Display area .18 86 90 94
Shopper traffic .27 90 88 89
Operating costs .10 86 91 96
Neighborhood .10 90 86 84
1.00
Using the above factor ratings, calculate the composite score for each location. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)
Location Composite Score
A
B
C
Answer:
Location Composite Score
A 84.28
B 86.81
C 91.00
Explanation:
Calculation for the composite score for each location Using the above factor ratings
A
Factor Weight A
Convenience .15 ( .15*86 )=12.90
Parking facilities .20 (.20*70)=14.00
Display area .18 (.18*86)=15.48
Shopper traffic .27 (.27*90)=24.30
Operating costs .10 (.10*86 )=8.60
Neighborhood .10 (.10* 90 )=9.00
Total 1.00= 84.28
B
Factor Weight B
Convenience .15 (.15* 77)=11.55
Parking facilities .20 ( .20* 88)=17.60
Display area .18 (.18* 90)=16.20
Shopper traffic .27 (.27*88 )=23.76
Operating costs .10 (.10* 91)=9.10
Neighborhood .10 (.10*86 )=8.60
Total 1.00 = 86.81
C
Factor Weight C
Convenience .15 (.15* 83)=12.45
Parking facilities .20 (.20*98)=19.60
Display area .18 (.18*94)=16.92
Shopper traffic .27 (.27*89)=24.03
Operating costs .10 (.10*96)=9.60
Neighborhood .10 (.10*84)=8.40
Total 1.00 = 91.00
Therefore the composite score for each location is:
Location Composite Score
A 84.28
B 86.81
C 91.00
Based on the above calculation C is the best because it has the highest composite score of 91.00.
In the rational choice decision process model, which of the following immediately follows the step where possible choices have been discovered or developed?
a. Discover possible choices.
b. Select the choice with the highest value.
c. Implement the selected choice
d. Evaluate the selected choice.
Answer:
Correct Answer:
b. Select the choice with the highest value.
Explanation:
In the rational choice decision process model, it is a series of process whereby steps are taking towards making a beneficial decision for a given business setup. In a situation where possible choices has been discovered, the next step would be to select the choice with the highest value which is going to be implemented.
The step that followed where possible choices have been discovered or developed is option b.
The following information should be considered:
In the case of the rational choice decision process, it should be the sequence of the process in which the steps should be taken so that the decision should be carried out i.e. beneficial for the business setup. When the possible choices are discovered so the next step should be that the choice should be selected having the high value.Therefore we can conclude that The step that followed where possible choices have been discovered or developed is option b.
Learn more: brainly.com/question/6201432
Assume the global economy consists of just two trading partners, the United States and Europe. Determine whether each scenario below corresponds to the United States having a trade deficit, balanced trade, or a trade surplus. U.S. Trade deficit.
a. The value of European assets purchased by Americans exceeds that of American assets purchased by Europeans.
b. In the United States, the sum of private savings and government savings is less than private investment.
c. Europeans purchase more goods and services from the United States than Americans purchase from Europe.
d. Net foreign investment for the United States is positive.
e. Net exports for Europe arc zero.
f. Exports from the United States equal imports into the United States.
Answer:
United States and Europe
Determination of United States having a trade deficit, balanced trade, or a trade surplus:
a. Trade surplus (investment surplus)
b. No effect on trade surplus or deficit
c. Trade surplus
d. Investment surplus
e. Balanced trade
f. Balanced trade
Explanation:
The United States experiences a trade surplus when its exports to Europe is higher than the imports from Europe, whether it is for goods, services, or investments.
On the other hand, the United States will experience a trade deficit when its imports from Europe are more than its export to Europe.
The US and Europe will have some advantages and disadvantages to having a trade deficit or surplus. When the US experiences a surplus, the exchange rate between the two continents increases in favor of the US. However, there will a reduction of the competitiveness of the US exports as higher prices will be incurred by Europe for US exports.
In the Vaughn Manufacturing, indirect labor is budgeted for $108000 and factory supervision is budgeted for $36000 at normal capacity of 160000 direct labor hours. If 170000 direct labor hours are worked, flexible budget total for these costs is:
Answer:Flexible budget =$ 150,750
Explanation:
Variable overhead rate = $108,000 / 160000 = $ 0.675 per hour
(budgeted supervision cost) Fixed overhead = $ 36,000
Flexible budget = Variable over head rate x direct labour + budgeted supervision cost (fixed overhead)
0.675 x 170,000+ 36,000
= 114,750+36,000
=$ 150,750
Which one of the following are tools that company managers can use to promote operating excellence in performing value chain activities?
a. Benchmarking, cost effciency optimization, and value chain performance optimazation programs
b. Six signma programs, value chain performance optimazation programs, and best practice innovation programs
c. Total quality management, cost optimization, and value chain efficient programs
d. Business process reengineering, best practice standardization programs, and six sigma
e. adoption of best practices, TQM, and business process reengineering
Answer:
e. adoption of best practices, TQM, and business process reengineering
Explanation:
To promote operational excellence in the execution of value chain activities, the most appropriate tools to be implemented in an organization are the adoption of best practices, TQM and business process reengineering.
Total quality management refers to the continuous improvement of all operational processes, in order to reduce costs, failures, and waste, leading to the implementation, control and review of all organizational processes, including the adoption of advanced technology, adequate training for employees, etc.
Business process reengineering would also help the organization reevaluate its value chain and implement improvements that would increase the performance and functionality of each essential step in the value chain.
Therefore, these integrated tools would ensure continuous optimization at all stages of the value chain, which would mean for the company the effectiveness of the channels and activities for the company to produce the right product, in the right quantity, in the right place and at the right time.
if average daily demand for an item is 15 units safety stock is 55 units and lead time is three days the rop will be
Answer:ROP= Reorder Point = 100
Explanation:
Reorder Point (ROP), also called reorder level, is the level of inventory which causes that the stock of a business is replenished. When a stock is being utilized and reaches a set amount by a firm, it holds that such item be reordered or replenished.
ROP= Reorder Point = (Average Daily Usage x Average Lead Time in Days) + Safety Stock
=(15 x 3) + 55 = 100
This means that when the inventory level of stock falls to 100, the commodity or item should be reordered.
Which of the following statements accurately brings out the difference between technology enthusiasts and early adopters?
A. While the customer segment in the introduction stage consists of early adopters, the customers entering the market in the growth stage are technology enthusiasts.
B. Unlike technology enthusiasts, early adopters' demand is fueled more by intuition and vision rather than technology concerns.
C. While early adopters make up the smallest market segment, technology enthusiasts make up the mass market.
D. Firms need to communicate products' potential applications in a more direct way when attracting technology enthusiasts rather than early adopters.
Answer:
B. Unlike technology enthusiasts, early adopters' demand is fueled more by intuition and vision rather than technology concerns.
Explanation:
When a company is growing it attracts various types of customers that patronise their products.
The technology enthusiasts are those ones that will test a beta version of a product and make technological recommendations. They have passion for testing latest gadgets and have more knowledge of the product than the average customer.
Early adopters are those that adopt a product before most other people. They are less concerned with technology concerns, but rather are visionary.
They focus on the potential of a product and therefore promote it to other users. A trait of early adopter is that they want to stay ahead of the trend so they seek out new products.
How much time, on average, would a server need to spend on a customer to achieve a service rate of 20 customers per hour?
Answer:
3 hour 18 minutes or 3 hour
Explanation:
According to the given situation, the computation of time on average is shown below:-
The Average waiting time in the system
= [tex]\frac{1}{\mu} -\gamma[/tex]
Now we will put the values into the above formula to reach the time on average which is here below:-
[tex]= \frac{1}{20} - 1[/tex]
[tex]= \frac{1}{19}[/tex]
= 0.053 × 60 minutes
= 3 hours 18 minutes
We assume [tex]\gamma[/tex] is 1 hour
Therefore for computing the time on average we simply applied the above formula.
Company XYZ has 2 fixed price contracts for 2 different clients. The company has enough capacity for both contracts but is uncertain whether they will be profitable. Using the information below, a) calculate the activity-based costs and profits for each contract (this requires more than one step) and b) calculate the profit for each job using absorption costing, absorbing overheads using molding hours: Enter all answers in number format without commas, decimals, or dollar signs. Customer AAA BBB Component Type A999 B999 Contract Value ($) $27,000 $100,000 Contract Quantity 1,000 unit 2,000 unit Material cost/unit $15 $20 Molding time/batch 5 hours 7.5 hours Batch size 100 units 50 unitsAnnual Budgeted overheads as follows:Activity Cost Driver Cost driver CostMolding Molding hours 2,000 $150,000Inspection Batches 150 $75,000Production Mgmt Contracts 20 $125,000 Required:Calculate the activity-based costs and profits for each contract.
Answer:
The contract A yields a loss under ABC but Contract B yields a profit.
ABC Profit contract A $ (3000) contract B $ 11250
Under absorption costing both contract yield profits.
Absorption Profit contract A $ 3250 contract B $7500
Management should make decisions using ABC and reject Contract A and accept Contract B.
Explanation:
Customer AAA BBB
Component Type A999 B999
Contract Value ($) $27,000 $100,000
Contract Quantity 1,000 unit 2,000 unit
Material cost/unit $15 $20
Molding time/batch 5 hours 7.5 hours
Batch size 100 units 50 units
Activity Based Rate= Cost per Unit of Cost Driver
Activity Cost driver Cost Rate
Molding 2,000 $150,000 $150,000 / 2,000 = 75
Inspection 150 $75,000 $75,000/150 = 500
Production 20 $125,000 $125,000/20= 6250
Total $ 350,000
Cost Drivers Consumed
Activity A999 B999
Molding time/batch 5 hours* 10 7.5 hours *40
50 300
Batch size 1,000 unit/ 100 units 2,000 unit/50 units
= 10 =40
ABC Profits for Each Contract
A999 B999
Selling Price $27,000 $100,000
Materials 15*1000 20 * 2000
= 15000 = 40,000
Molding 50 hours *75 300* 75
3750 22500
Inspection 10 batches *500 40 batches *500
$ 5000 $ 20000
Management Contracts $ 6250 $ 6250
Total $ 30,000 $ 88,750
Profit $ (3000) $ 11250
Overhead Rate Absorption Costing
Total Overheads= ( 150,000 + 125,000+ 75000) = $ 350000
Annual Molding Hours = 2000
Rate= $ 350,000/2000=$ 175 per molding hour
Absorption Costing
Profit For each Contract
A999 B999
Selling Price $27,000 $100,000
Materials 15*1000 20 * 2000
= 15000 = 40,000
Overheads 50 hours *175 300 Hours *175
= 8750 = 52,500
Total Cost 23750 92500
Profit 3250 7500
The contract A yields a loss under ABC but Contract B yields a profit.
Under absorption costing both contract yield profits.
Management should make decisions using ABC and reject Contract A and accept Contract B.
Tameika Johnson’s supervisor is in charge of the arrangements for the annual company party. He has given Johnson the responsibility for finding a caterer for the event, arranging the entertainment, and selecting the door prizes. Johnson’s supervisor used _____ to make her accountable for most of the success or failure of the picnic.
Answer: delegation of authority
Explanation:
From the question, we are informed that Tameika Johnson’s supervisor is in charge of the arrangements for the annual company party and that he has given Johnson the responsibility for finding a caterer for the event, arranging the entertainment, and selecting the door prizes.
In this scenario, the outcome of the picnic has already been delegated to Johnson because the job role has been shared to him.
The understatement of the ending inventory balance causes: Multiple Choice Cost of goods sold to be understated and net income to be overstated. Cost of goods sold to be overstated and net income to be correct. Cost of goods sold to be overstated and net income to be understated.
Answer:
Cost of goods sold to be overstated and net income to be understated.
Explanation:
Ending Inventory are deducted from the cost of sales figure to reach the gross profit amount in the trading account.
Understatement of Inventory means that Cost of goods sold will overstated and gross profit understated, consequently, net income will be also understated.
Scanlon Corporation has estimated its activity for April as follows: Sales: $900,000 Gross profit (based on sales): 30% Increase in accounts receivable during month: 15,000 Increase in finished goods inventory during month: 25,000 Total selling and administrative costs: 80,000 Depreciation included in selling and administrative costs: 15,000 Scanlon has no raw material or work in process inventory at the beginning or end of April. On the basis of the above, what are estimated cash disbursements for April
On the basis of the above, Scanlon Corporation's estimated cash disbursements for April is: $695,000.
Data and Calculations:
Sales: $900,000
Gross profit (based on sales): 30% 270,000
Cost of goods sold = (Sales - Gross profit) $630,000
Increase in accounts receivable during month: 15,000
Increase in finished goods inventory during month: 25,000
Total selling and administrative costs: 80,000
Depreciation included in selling and administrative costs: 15,000
Cash spent on selling and administrative costs = $65,000 ($80,000 - $15,000)
Cash disbursements for April:
Cost of goods sold = $630,000
Selling and admin. (cash) = 65,000
Total cash disbursements = $695,000
Learn more about cash disbursements here: https://brainly.com/question/24195927
Amy and Maxwell Walker have decided to invest their investment dollars: 40 percent in stocks, 30 percent in bonds, and 30 percent in cash equivalents. Over the past year, the market value of their bonds increased while the market value of their stocks declined. Using the asset allocation model, they should now
Answer:
C.use some of their cash equivalents to buy more stocks.
Explanation:
Data provided in the question
Stock = 40%
Bond = 30%
cash equivalent = 30%
The Market value of the bond rise
The market value of the stock falls
Based on the above information,
According to the asset allocation model, mostly everyone uses some of their cash equivalents i.e bank account, marketable securities to purchased more stock
Hence, the option c is correct