Answer:
$20,646.92
Explanation:
We are to calculate the future value of the amount :
The formula for calculating future value:
FV = P (1 + r)^n
FV = Future value
P = Present value
R = interest rate
N = number of years = 65 - 20 = 45
$1500(1.06)^45 = $20,646.92
Why are valuations of privatized businesses previously owned by the governments of developing countries more difficult than valuations of existing firms in developed countries? Name and explain the seven reasons.
Answer of Explanation:
Following are seven reasons why valuation of privatized businesses are more difficult in a developing country:
Future cash flows can not be estimated accurately and its competitors might be far away or their might be no competitor in this market.Developing countries don't have sufficient data related to industry players operating in the area of firm that has to be valuated. The data that will be missing would be the market share and market growth etc.The exchange rate will be changing very significantly that it poses significant question mark on the accuracy of the valuation of business.The level and type of funding that can be used to flourish business is doubtful. This means we don't know if anyone is willing to lend us money and how much the lending will cost to the company.The risk associated with the business is also doubtful.The economic situation are uncertain which means we don't know the future of the business.The part of business might be controlled by the government which might result in a control conflict in the future.On February 15, Jewel Company buys 7,300 shares of Marcelo Corp. common stock at $28.56 per share plus a brokerage fee of $400. The stock is classified as available-for-sale securities. This is the company’s first and only investment in available-for-sale securities. On March 15, Marcelo Corp. declares a dividend of $1.18 per share payable to stockholders of record on April 15. Jewel Company received the dividend on April 15 and ultimately sells half of the Marcelo Corp. stock on November 17 of the current year for $29.33 per share less a brokerage fee of $250. The journal entry to record the dividend on April 15 is:______.A) Debit Cash $8,614; credit Dividend Revenue $8,614.B) Debit Cash $8,614; credit Interest Revenue $8,614.C) Debit Cash $8,614; credit Gain on Sale of Investments $8,614.D) Debit Cash $7,865; credit Dividend Revenue $7,865.E) Debit Cash $7,865; credit Interest Revenue $7,865.
Answer:
A. Debit Cash $8,614; credit Dividend Revenue $8,614.
Explanation:
The journal entry for recording the dividend as on April 15 is shown below:
On April 15
Cash Dr (7,300 shares × $1.18 per share) $8,614
To Dividend revenue $8,614
(Being the dividend is recorded)
For recording this here we debited the cash as it increased the assets and credited the dividend revenue as the revenue is also increased
Therefore the correct option is A.
The city of Hartwell spends about $3 million annually on snow removal. The city is considering amending its real property tax law to allow homeowners to offset the cost of private snow removal against their annual property tax liability. This amendment would affect the:
Answer: efficiency of the tax
Explanation:
From the question, we are informed that the city of Hartwell spends about $3 million annually on snow removal and that the city is considering amending its real property tax law to allow homeowners to offset the cost of private snow removal against their annual property tax.
It should be noted that the amendment to the affect the efficiency of the tax. The aim of the amendment in this case is to help change the behavior of the taxpayer by giving out rewards to the people who remove their own snow.
You just obtained a loan of $15,700 with monthly payments for four years at 6.35 percent interest, compounded monthly. What is the amount of each payment
Answer:
I prepared an amortization schedule using excel. You will need to make 48 monthly payments of $371.24
The insurance policy, together with the policy application and any added riders form what is known as
Answer:
certificate of coverage
Explanation:
All of this forms what is known as a certificate of coverage. These are all the forms detailing all of the benefits you and your dependents have under the insurance plan that you are currently enrolled in. This also clearly details all of the services and benefits that are not included in the insurance policy and are described as exclusions to the policy. This is not to be confused with a certificate of Creditable Coverage (COCC) which is only a document that proves that your insurance has ended.
The four kinds of structural organizational change enabled by IT, in order from least to most risky, are:
Answer: automation, rationalization, redesigning, and paradigm shift.
Explanation:
The four kinds of structural organizational change enabled by IT, in order from least to most risky, are automation, rationalization, redesigning, and paradigm shift.
In automation, it should be noted that the employees are typically enabled to perform tasks more efficiently. Paradigm shift has to do with fundamental changes that occurs with the underlying assumption
What is the tax equivalent yield for a City of Mesa 2.5% muni bond for an investor in the 35% tax bracket?
Answer:
Tax equivalent yield = 38.5%
Explanation:
Return on a municipal bond = 2.5%
Since municipal bonds are non taxable, for a similar taxable bond, tax equivalent yield is :
Tax equivalent yield = Yield on municipal bond / (1 - tax rate)
Tax equivalent yield = 2.5% / ( 1 - 0.35)
Tax equivalent yield = 0.025 / 0.65
Tax equivalent yield = 0.03846154
Tax equivalent yield = 38.5%
If investors are expecting a dividend cut, then the announcement of the decreased dividend payment will:
The options available are:
a. cause the stock price to decline by more than the dividend amount
b. not affect the stock price as long as the announcement was in line with expectations
c. cause the stock price to increase if the cut was greater than anticipated
d. the signal that the next dividend will be cut even further
Answer:
b. not affect the stock price as long as the announcement was in line with expectations
Explanation:
Given that the announcement will be made in line with the expectation of the investors, then the announcement of the decreased dividend payment will have no effect on the stock price. Thus, it will neither cause the price of the stock to decline not to rise since the investors are already aware of the market situation and there is no reason to make panic sales or enthusiastic buys.
Hence, the correct answer is option B.
Which of the following statements concerning income tax rate structures is false?
a) Under a progressive rate structure, the marginal rate and the average rate are equal
b) Under a regressive rate structure, the average rate for low-income individuals is more than the average rate for high-income individuals
c) Under either a regressive, proportionate or progressive rate structure, high-income taxpayers pay more dollars of tax than low-income individuals
d) In theory, a progressive rate structure results in equal economic sacrifice across taxpayers
e) Under a proportional tax system the average tax rate and the marginal tax rate are equal.
Answer:
a) Under a progressive rate structure, the marginal rate and the average rate are equal
Explanation:
There are basically three types of tax structure which are as follows
1. A regressive tax levied the similar percentage in the goods that are purchased irrespective of the income of the buyer it would not be good for the poor earners
2. A proportional tax levied the similar tax rate for all types of individuals irrespective of the income
3. A progressive tax levied the high percentage who has higher income as they can afford to pay more and the lower percentage for the lower income and vice versa.
So based on the given options, the option A is false and hence the same is to be considered
7. List and explain 3 things that make you enthusiastic about learning?
Answer:
1) Reward
2) Enjoyment
3) Personality Growth
Explanation:
Learning Business
I opted for Business because it is very easy as compared to other subjects.
It is applicable anywhere anytime.
It is rewarding in terms of rules and regulations.
Otherwise Learning
It enhances your abilities making you a strong enough person to fight any challenge.
It is always rewarding. It pays you one way or other.
It polishes and nourishes your personality to an extent where you feel better adapted towards life.
It is an enjoyment in the sense that it makes you see how well you use your abilities. For example I like mathematics and I enjoy doing it. Some people like drawing and they enjoy it.
Rainbow, Inc. began operations on January 1 of the current year with a $13,000 cash balance. Forty Five percent of sales are collected in the month of sale; 55% are collected in the month following sale. Similarly, 15% of purchases are paid in the month of purchase, and 85% are paid in the month following purchase. The following data apply to January and February: January February Sales $ 45,000 $ 65,000 Purchases 35,000 50,000 Operating expenses 8,000 10,000 If operating expenses are paid in the month incurred and include monthly depreciation charges of $3,500, determine the change in Rainbow’s cash balance during February.
Answer:
$10,250
Explanation:
cash account January:
January 1 = $13,000
cash collected in January = $20,250
purchases paid in January = ($5,250)
operating expenses (not including depreciation) = ($4,500)
Ending cash balance January 31 = $23,500
cash account February:
February 1 = $23,500
cash collected from January sales = $24,750
cash collected from February sales = $29,250
January purchases paid = ($29,750)
February purchases paid = ($7,500)
operating expenses (not including depreciation) = ($6,500)
Ending cash balance February 28 = $33,750
change in Rainbow’s cash balance during February = $33,750 - $23,500 = $10,250
The average total cost of producing electronic calculators in a factory is $10 at the current output level of 260 units per week. If fixed cost is $880 per week, then what is the firm's variable cost? (enter answer as just a number no commas, dollar signs or the like).
Answer:
6.62
Explanation:
total production costs = total output x average total cost per unit = 260 calculators x $10 per unit = $2,600
total fixed costs = $880
total variable costs = total production costs - total fixed costs = $2,600 - $880 = $1,720
variable cost per unit = total variable costs / total output = $1,720 / 260 calculators = $6.61538 = $6.62 per unit
Accumulated depreciation shows a beginning balance of $9,300 and an ending balance of $10,700. How much depreciation expense was reported in the current year's income statement
Answer:
$1400
Explanation:
Accumulated depreciation is the total depreciation of an asset and is recorded on the balance sheet while the depreciation expense is recorded on the income statement as an expense.
The depreciation expense is the difference between the accumulated depreciation at the end and the accumulated depreciation at the beginning. It is given as:
Depreciation expense = accumulated depreciation at the end - accumulated depreciation at the beginning = $10700 - $9300 = $1400
Depreciation expense = $1400
SEC Rule 10b-18 allows an issuer to buy its shares in the open market:________.A. at any price that is reasonably related to the current marketB. at the highest independent bid or the last reported sale price, whichever is higherC. at the lowest independent offer or the last reported sale price, whichever is lowerD. under no circumstances, since this is considered to be market manipulation
Answer:
B. at the highest independent bid or the last reported sale price, whichever is higher
Explanation:
SEC Rule 10b-18 was issued to create a safe harbor that reduces a company's possible legal liabilities related to repurchasing their own stock. Companies can decide to follow it or not, but if they follow it, they must comply with specific requirements that depend on the company's size and trading activities. Even if companies follow all the requirements of this "safe harbor", all legal liabilities are not eliminated, instead some specific provisions will not be considered to have been violated by the company.
The conditions related to this rule include
Manner of purchase conditionsTiming conditionsPrice conditionsVolume conditionsYour client, Bo Regard, holds a complete portfolio that consists of a portfolio of risky assets (P) and T-Bills. The information below refers to these assets.
E(Rp)= 12%
Standard deviation of P 7.20%
Tbill rate 3.60%
Proportion of complete portfolio in P 80%
Proportion of complete portfolio in T bills 20%
Composition of P
Stock A 40%
Stock B 25%
Stock C 35%
Total 100%
What is the expected return on Bo's complete portfolio?
A) 10.32%
B) 5.28%
C) 9.62%
D) 8.44%
E) 7.58%
Answer:
A) 10.32%
Explanation:
Calculation for the expected return on Bo’s complete portfolio
Using this formula
Expected return =(Proportion of complete portfolio in P×E(Rp))+Proportion of complete portfolio in T bills×Tbill rate)
Let plug in the formula
Expected return=(80%×12%) + (20%×3.60%)
Expected return=0.096+0.0072
Expected return=0.1032×100
Expected return=10.32%
Therefore the expected return on Bo’s complete portfolio will be 10.32%
"What is Al’s total revenue? 3 pts) B. What are Al’s explicit costs? In numbers (3 pts) C. What is his accounting profit? In Numbers (3 pts) D. List 2( in numbers ) implicit costs that Al has not included. (3 pts) E. What is Al’s pure economic profit (loss)in numbers? ("
Answer:
A. $1,020,000
B.$680,000
C.$340,000
D.$95,000
E.$245,000
Explanation:
A. Calculation for Jon’s total revenues
Using this formula
Jon's total revenue = Amount of fees per person × Number of persons
Let plug in the formula
Jon's total revenue = $1,200 × 850
Jon's total revenue=$1,020,000
B. Calculation for Jon’s explicit costs
Using this formula
Explicit costs = Amount of money that goes for instructors, maintenance, equipment,insurance, depreciation ×Number of persons
Let plug in the formula
Explicit costs= $800 ×850
Explicit costs =$680,000
C. Calculation for the his accounting profit
Using this formula
Accounting profit = Amount of Revenue - Explicit costs
Let plug in the formula
Accounting profit= $1,020,000 - $680,000 Accounting profit=$340,000
D. Calculation to List 2 in numbers 2 implicit costs that Jon has not included
Based on the information given we were told that he is foregoing an amount of $92,000 as wage and 1.5% interest on his amount of $200,000 which is a corporate bonds to start the business.
Hence
Jon total opportunity costs = $92,000 + (1.5%×$200,000)
Jon total opportunity costs = $92,000 +$3,000 Jon total opportunity costs=$95,000.
E. Calculation for Jon’s pure economic profit (or loss) in numbers
Using this formula
Economic profit = Accounting profit - opportunity costs
Let plug in the formula
Economic profit = $340,000-$95,000
Economic profit = $245,000
Natalie and Curtis have been experiencing great demand for their cookies and muffins. As a result, they are now thinking about buying a commercial oven. They know which oven they want and that it will cost $17,000. The company already has $5,000 set aside for the purchase and will need to borrow the rest.
Natalie and Curtis met with a bank manager to discuss their options. She is willing to lend Cookie & Coffee Creations Inc. $12,000 on November 1, 2017, for a period of 3 years at a 5% interest rate. The terms provide for fixed principal payments of $2,000, on May 1 and November 1 of each year plus 6 months of interest. Determine the current portion of the note payable and the long-term portion of the note payable at October 31, 2018.
Answer:
Cookie & Coffee Creations Inc.
a) Current Portion of Note Payable:
= $4,000
b) Long-term Portion of Note Payable:
= $6,000
Explanation:
Data and Calculations:
Date of Note Payable = November 1, 2017
Period = 3 years
Interest rate = 5%
Terms of payment:
Fixed principal payments = $2,000
Payment dates = May 1 and November 1
Each year's principal repayment = $4,000 ($2,000 x 2)
From November 1, 2017 to October 31, 2018 = $4,000
At October 31, 2018, Payment made = $2,000 on May 1
Remaining Note payable = $10,000 ($12,000 - $2,000)
Current Portion = $4,000 ($2,000 x 2)
Long-term Portion = $6,000
b) The current portion of $4,000 will be payable on November 1, 2018 and May 1, 2019. The current portion represents the short-term portion of the note payable, which is the portion that will be settled within a 12-months' period. Since Cookie & Coffee Creations Inc. had already paid $2,000 on May 1, 2018, the long-term portion will only remain $6,000 ($12,000 - $2,000 - $4,000), which is the difference between the total note payable, the portion paid on May 1, 2018, and the current portion of $4,000 that will be payable within one year.
If Newble paid dividends of $100 million in 2016 and made no stock issues, what must have been net income during the year?
Answer: $310 million
Explanation:
The net income is used to pay dividends as well as being added to equity at the end of the period. If no new stock was issued then the net income would be the increase in equity plus dividends.
Increase in Equity = Equity 2016 - Equity 2015
Equity 2016 = Total assets 2016 - total liabilities 2016
= ( 420 + 1,420) - ( 240 + 920)
= $680 million
Equity 2015 = Total assets 2015 - total liabilities 2015
= ( 310 + 1,200) - ( 210 + 830)
= $470 million
Increase in Equity = 680 - 470
= $210 million
Net Income = Increase in equity + dividends
= 210 + 100
= $310 million
Tyson Inc. is currently trading at $18 per share. The company is expected to pay a dividend of $1.63/per share next year. The dividend is expected to growth 2.5% per year into perpetuity, and the cost of equity is currently 10.5%. Using Gordon growth what is the present value of Tyson Inc, and given you answer should you buy or sell the stock
Answer:
$20.38 buy
Explanation:
The computation of present value is shown below:-
Fair Value according to Gordon Model = Expected Div ÷ (Required Return - Growth rate)
= $1.63 ÷ (10.5% - 2.5%)
= $1.63 ÷ 8%
= $20.38
Fair Price = $ 20.38 and Actual Price = $18.00
As Fair Price is greater than the Actual Price so, the stock is under priced. Therefore advice to buy.
____ projects are a set of projects where the acceptance of one project means that other projects cannot be accepted.
Answer:
Mutually exclusive
Explanation:
Mutually exclusive projects are projects where if you accept one project, the other project has to be rejected.
For example, a company has $250,000 to invest in a project. It can either choose to build a warehouse or buy an equipment. Both projects cost $250,000. Because of the limited capital, only one project can be chosen. This is an example of a mutually exclusive project
Which factor does not shift the demand for bonds Question 3 options: Expected inflation Liquidity Expected return Government deficit
Answer:
Government deficit
Explanation:
Bonds are financial instruments, and financial instruments are affected by various factors, for their demand and supply.
If there is a government deficit and bonds are completely private and not treasury bonds then there would be no effect on the demand of bonds.
Expected inflation causes the interest rate on bonds to increase, accordingly the demand for bonds increase.
Liquidity of a financial instrument affects a lot.
Highly liquid bonds are highly demanded and vice-e-versa.
Expected return affects the demand, if return expectations are high then demands are also high, if expected return is low, then demands are also low.
KL Electronics has paid a quarterly dividend of $.42 per share for the past two years.This quarter,the firm plans to pay $.42 plus an additional $.05 per share.The firm has stated that it is uncertain whether it will pay $.42 or $.47 per share next quarter.Which one of the following is the best description of the additional $.05 that is being paid this quarter?
A) Liquidating dividend
B) Special dividend
C) Extra dividend
D) Stock dividend
E) Normal dividend
Answer:
The answer is C. Extra Dividend
Explanation:
As being stated above(in the answer section), the answer is extra dividend.
Extra Dividend is the form of dividend paid to shareholders in addition to the normal regular dividend. This usually happens during the period of unexpected high profit.
Also, this is paid after the year-end.
If this dividend was paid in form of additional stock being given to the shareholders, then it will be called stock dividend.
Under SEC rules, filing of the Form 144, required when selling restricted stock, is the responsibility of the:________. A. issuer B. broker-dealer C. seller D. transfer agent
Answer: C. seller
Explanation:
The filing of SEC Form 144 is the responsibility of a representative of the company that wishes to sell the stock. The company can be represented by an executive officer, a director, or a recognised affiliate of the company.
This form is filled when the restricted stock to be sold either exceeds 5,000 in number or would command a price greater than $50,000.
Can a local businessman pay a police officer $50 a week to watch his business more closely? Group of answer choices
Answer: b. No, Public Officials cannot give consideration on duties they are already supposed to perform.
Explanation:
The options are:
a. Yes, as long as the contract is registered with the Secretary of State
b. No, Public Officials cannot give consideration on duties they are already supposed to perform
c. Yes, as long as 50$ is reasonable amount to watch the business
d. Yes, as long as a court reviews the contract within 30 days
e. No, unless a court approves the agreement.
From the question, we are asked whether local businessman can pay a police officer $50 a week to watch his business more closely. This is not true as Public Officials cannot give consideration on duties they are already supposed to perform.
The role of the police is to ensure that lives and properties are always safe and they're pair by the government for the role, therefore, they shouldn't be offered money to do what they're naturally expected to do.
Cyberhost Corporation's sales were $225 million last year. If sales grow at 6% per year, how large (in millions) will they be 5 years later
Answer:
$301.10 MILLION
Explanation:
the formula for determine the future value of sales =
P (1 +r)^n
P = Present value = $225 million
R = interest rate = 6%
N = number of years = 5
$225 million(1.06)^5 = $301.10 MILLION
A restaurant at a popular Colorado casino provides priority service to player’s card holders. The restaurant has 10 tables or booths where customers may be seated. The service time (time a booth or table is occupied) averages 42 minutes once a party is seated. The customer arrival rate is 8 parties per hour, with the parties being equally divided between card holders and people without player’s cards. What is the average time that parties WITHOUT player’s cards wait to be seated?A) Approx. 55 secondsB) Approx. 2 hoursC) Approx. 40 minutesD) Approx. 24 seconds
Answer: Option A -- Approx. 55 seconds
Explanation:
It should be noted that, after proper calculations, the average time that parties WITHOUT player’s cards wait to be seated is Approximate 55 seconds. Therefore, Approx. 40minutes, 2hours and 24 seconds are wrong.
Programs allowing for the direct pass-through of losses and income to investors include all of the following EXCEPT:
A) REITs.
B) oil and gas drilling direct participation programs.
C) S corporations.
D) new construction real estate direct participation programs.
Answer:
A) REITs (Real Estate Investment Trust).
Explanation:
Note that a Real Estate Investment Trust (REIT) is a company that gathers the capital of several investors to secure a real estate property, thus, they allow each individual investors to earn dividends from thier real estate investments.
The Real estate investment trust program often allows the passing through of income but not for losses, in a sense the real estate investors bear any losses that maay arise.
The COGS reflected on the income statement is the same COGS we use in the development of a MCS. True False
Answer:
False
Explanation:
In marginal costing systems (MCS), the cost of goods sold (COGS) is made up of only variable costs. This helps in determining the contribution margin, which is the difference between sales revenue and variable costs of production.
However, the cost of goods sold reflected on the income statement is not only the variable costs. They include all the products' costs based on absorption costing, which is used in income statement preparation under the financial accounting system. Marginal costing system is simply a cost accounting technique for internal or managerial usage.
Normative economic analysis involves value judgments and opinions. purely descriptive statements. testable hypothes
Answer:
value judgments and opinions
Explanation:
Normative Economics is a term that describes a form of contemporary economics which concentrates on the expected economic ideals or standards in relation to the advancement of all aspect of the economy.
Hence, Normative economics can be said to involve value judgment and opinions of what the economy as a whole should be.
Therefore, the right answer is "value judgment and opinion."
When Deer Valley Resort Co. (DVRC) was developing its ski resort in the Wasatch Mountains near Park City, Utah, it sold parcels of land in the resort village to third parties. Each sales contract reserved the right of approval over the conduct of certain businesses on the property including ski rentals. For fifteen years, DVRC permitted Christy Sports, LLC, to rent skis in competition with DVRC's ski rental outlet. When DVRC opened a new mid-mountain ski-rental outlet, it revoked Christy's permission to rent skis. This meant that most skiers who flew into Salt Lake City and shuttled to Deer Valley had few choices: they could carry their ski equipment with them on their flights, take a shuttle into Park City and look for cheaper ski rentals there, or rent from DVRC. Christy filed a suit in a federal district court against DVRC. Was DVRC's action an attempt to monopolize in violation of Section 2 of the Sherman Act
Answer:
No it wasn't a violation of Section 2 of the Sherman Act.
Explanation:
This is an actual court case which was ruled in favor of DVRC. The court used an analogy to compare DVRC with Disneyland, where the theme park owners would not allow competition within their premises. Even though DVRC sold the land parcel to Christy Sports, a restrictive covenant was imposed at the time of the sale where DVRC could decide freely which third party businesses could operate there. Since the covenant is legal, there is no reason why DVRC will not enforce it.