Answer:
D
Explanation:
Profit = Revenue - cost
Cost = fixed cost + variable cost
if variable cost increases by 10%, cost would increase by 10%.
Revenue also increases by 10%
So, the increase in revenue would be cancelled by the increase in cost and profit would not change
good is excludable if: a. it is Wi-Fi or a similar service. b. people who do not pay cannot be easily prevented from using the good. c. one person's use of the good does not reduce the ability of another person to use the same good. d. people who do not pay can be easily prevented from using the good.
Answer:
The correct answer is:
people who do not pay can be easily prevented from using the good. (d)
Explanation:
Excludable goods or services are those to which the consumer cannot have access unless payment of some form is made. By contrast, a non-excludable good or service is one to which the consumer cannot be prevented from using even without payment. Excludable goods can be further divided into rivalrous and non-rivalrous.
A rivalrous excludable good or service is one in which usage by a consumer or usage by one party prevents or reduces significantly, its use by another consumer or party examples are goods such as clothes, food, cars etc, while non-rivalrous excludable goods/services include tv subscriptions, cinemas, etc.
Suppose that short-term municipal bonds currently offer yields of 4%, while comparable taxable bonds pay 5%. Which gives you the higher after-tax yield if your combined tax bracket is:
Answer:
1.Taxable bonds
2Taxable bonds
3.They have the same after-tax yield
4.
municipal bond
Explanation:
The missing tax brackets are zero,10%,20% and 30%
Zero % tax rate:
municipal bond pays 4%
taxable bonds after tax yield=5%*(1-0)=5%
10% tax rate
municipal bond pays 4%
taxable bond after tax yield=5%*(1-10%)=4.5%
20% tax rate
municipal bond pays 4.0%
taxable bond after tax yield=5%*(1-20%)=4.0%
30% tax rate
municipal bond pays 4.0%
taxable bond after tax yield=5%*(1-30%)=3.50%
Apply the integration-responsiveness framework to describe which global strategy Hollywood studios followed originally, and how their strategic positioning has changed over time. Explain how and why.
Answer is given below :
Explanation:
Global integration refers to the coordination of the organization’s value chain operations within countries, achieving efficiency, synergy and cross-fertilization between countries so that equality between countries is maximized. Between global integration and local accountability, the integration-accountability framework is called to help managers develop a deeper understanding of the business. We can say at the outset or at the outset that an export strategy that applies to Hollywood is used when a company focuses primarily on its domestic operations. It is not intended to expand globally, but to export certain products to take advantage of international opportunities. It does not seek to adapt its products to international markets. It is not interested in responding to specific situations in other countries or formulating a unified world strategy. Hollywood not only produced films and shows that catered to the needs of its native business aimed at American Western culture, but as the industry began to expand it began to adopt a multi-national strategy. Multi dimensional strategy follows products or processes for specific situations in each country. In the initial example, Lincoln should use a multi-year strategy to adapt its manufacturing methods to the conditions of each country where electric factories are built. Retailers often use multicultural strategies because they must cater to local customer tastes. Hollywood has started producing Indian films like Kung Fu Panda, Karate Kids, Oscar Winning Slumdog Millionaire.The global strategy that Hollywood studios followed at first was the international strategy.
It should be noted that the global strategy that Hollywood studios followed originally was the international strategy where identical movies were showed in foreign countries.
This has changed now as there are different movies that are filmed and in different versions. Also, it isn't in the control of the government to edit out any part.
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In the past year, TVG had revenues of $3 million, cost of goods sold of $2.5 million, and depreciation expense of $200,000. The firm has a single issue of debt outstanding with book value of $1 million on which it pays an interest rate of 8%. What is the firm’s times interest earned ratio?
Answer:
TVG
Times Interest Earned Ratio (TIER) = Earnings Before Interest & Taxes divided by Interest Expense
= $300,000/$$80,000 = 3.75 times
Explanation:
a) TVG Income Statement:
Revenue $3,000,000
Cost of goods sold 2,500,000
Gross profit $500,000
Depreciation 200,000
EBIT $300,000
Interest Expense 80,000
Pre-tax Income $220,000
b) TVG's TIER shows the number of times that its earnings before interest and taxes covers the interest expense. It shows the ability of the TVG to settle its maturing debt obligations from current earnings. It is an important financial performance measure which potential investors in TVG will use to gauge the ability of TVG to meet financial obligations from the earnings it generates.
"A $10,000 municipal bond with 10 years to maturity is purchased in the primary market at 105. The bond is sold after 4 years at 105. The taxable gain or loss is a:"
Answer:
2 point capital gain
Explanation:
Every municipal bond that is purchased at premium is subject to straight line depreciation, whether the premium be trading premium or original issue premium.
Here the premium is 5 points = 105 - 100
Which shall be amortised over its useful life of 10 years.
Thus, for each year 1/2 point is amortised without allowing any tax deduction.
Thus, after 4 years total amortisation = [tex]\frac{1}{2} \times 4years = 2[/tex]
Thus, value at end of year 4 = 105 - 2 = 103 basis point.
Further the selling amount = 105 basis point.
Thus, 105 - 103 = 2 basis point shall be taxable.
A vendor at a carnival sells cotton candy and caramel apples for $2.00 each. The vendor is charged $60 to set up his booth. Furthermore, the vendor’s average cost for each product he produces is approximately $0.80.
a. Write a linear cost function representing the cost C(x) (in $) to the vendor to produce x products.b. Write a linear revenue function representing the revenue R(x) (in $) for selling x products.c. Determine the number of products to be produced and sold for the vendor to break even.d. If 60 products are sold, will the vendor make money or lose money?
Answer with its Explanation:
Requirement A. The cost function is equal to variable cost for "x" units and fixed cost which remains fixed. Hence:
Cost Function = C(x) = $60 + $0.8x
Requirement B. The revenue for any units "x" sold can be calculated by simply multiplying "x" with sales price per unit. Which means that:
Revenue Function = R(x) = $2 * x = $2x
Requirement C. Now we have to find the breakeven quantity and this could be calculated using the following formula:
Breakeven Point = Fixed Cost / (Selling Price per Unit - Variable Cost Per Unit)
By putting values we have:
Breakeven Point = $60 / ($2 - $0.8) = 50 units
Requirement D. As the number of units are above breakeven point (No profit and loss position), hence making sales above 50 units will generate profit for the company.
The profit for the company would be:
Total Profit = Contribution per unit * Units above Breakeven point
Total Profit = ($2 - $0.8) * 10 Units = $12
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.
Connie recently provided legal services to the Winterhaven LLC and received a 5 percent interest in the LLC as compensation. Winterhaven currently has $43,000 of accounts payable and no other debt. The current fair market value of Winterhaven’s capital is $270,000. (Leave no answer blank. Enter zero if applicable.)
a. If Connie receives a 5 percent capital interest only, how much income must she report and what is her tax basis in the LLC interest?
Income ______
Tax Basis ______
b. If Connie receives a 5 percent profits interest only, how much income must she report and what is her tax basis in the LLC interest?
Income ______
Tax Basis ______
c. If Connie receives a 5 percent capital and profits interest, how much income must she report and what is her tax basis in the LLC interest?
Income ______
Tax Basis ______
Answer and Explanation:
a. Connie registers $13,500 of ordinary revenue or 5% of the LLC's $270,000 property. Her LLC investment base is $13,500 as well.
b. Connie does not disclose any profits but will have an interest rate equal to her share of the LLC 's debt in the LLC. Since debt from the LLC is a non-recourse loan, it needs to be distributed to her through interest on earnings from Connie. Therefore her investment in the LLC is equivalent to $2,150 or 5% of the $43,000 accounts payable by the LLC.
c. Connie reports $13,500 of ordinary revenue or 5 percent of the $270,000 capital of the LLC. Her LLC interest base is $13,500, too. Her base in the LLC is $15,650 consists of the $13,500 benefit she accepts for earning her capital gain and her $2,150 non-recourse tax payable from the LLC.
Just how strong the competitive pressures are from substitute products depends on: Select one: a. Whether the available substitutes are products or services b. The speed with which buyer needs and expectations are changing c. Whether attractively priced substitutes are readily available and the ease with which buyers can switch to substitutes d. Whether the producers of substitutes have ample budgets for new product R
Answer: c. Whether attractively priced substitutes are readily available and the ease with which buyers can switch to substitutes
Explanation:
Substitute products are the product that can be used in place of another identical product e.g butter and margarine.
Just how strong the competitive pressures are from substitute products depends on whether attractively priced substitutes are readily available and the ease with which buyers can switch to substitutes.
1. While FF was started 40 years ago, its common stock has been publicly traded for the past 25 years. 2. The returns on its equity are calculated as arithmetic returns. 3. The historical returns for FF for 2012 to 2016 are:
Answer:
hello some details/parts of your question are missing attached below is the missing part
answer : A ) = 24.13%
B ) = 0.1084, The preceding data series represents a SAMPLE
C ) = 0.4494
Explanation:
A) The average realized return on FF stock can be calculated as
= 24% + 16.15% + 29% +39.9% + 12.35% / 5
= 24.13%
B) The preceding data series represents a SAMPLE standard deviation BECAUSE RETURNS WERE MADE ONLY FOR FIVE YEARS
and the sample standard deviation is calculated as
[tex]s^2 = \frac{summation ( x - mean vale)^2}{N-1}[/tex]
[tex]S^2 = \frac{0.0470383}{ 5 -1 }[/tex] = 0.01175056
s = [tex]\sqrt{0.01175056}[/tex] = 0.1084
C) coefficient of variation
coefficient of variation = standard deviation / mean
= 0.1084 / 0.2413 = 0.4494
On July 1, Shady Creek Resort borrowed $250,000 cash by signing a 10-year, 8% installment note requiring equal payments each June 30 of $37,258. What amount of interest expense will be included in the first annual payment
Answer:
Interest expense = $20,000
Explanation:
Loan Amortization: A loan repayment method structured such that a series of equal periodic installments will be paid for certain number of periods to offset both the loan principal amount and the accrued interest.
The annual installment is computed as follows:
Annual installment= Loan amount/annuity factor
Annual installment is already given as = 37,258 (already given)
Interest payment = interest rate × Loan balance at the beginning of the year
DATA
Interest rate = 8%
Loan balance at the beginning of the year = $250,000
Interest expense = 8%× 250,000 = $20000
Principal paid = Annual installment - Interest = 37,258-20,000 = 17,258 (this is not required but to explain the concept)
Interest expense = $20,000
Sally Eason put $4,000 in her deductible IRA this year. If Sally is in the 25 percent marginal tax bracket, the government actually contributed ____ of that amount for her. Group of answer choices
Answer: $1000
Explanation:
From the question, we are informed that Sally Eason put $4,000 in her deductible IRA this year and that Sally is in the 25 percent marginal tax bracket.
Based on the above information, the government contributed:
= 25% × $4,000
= 25/100 × $4,000
= 0.25 × $4,000
= $1000
Earnings per Share, Price-Earnings Ratio, Dividend Yield The following information was taken from the financial statements of Tolbert Inc. for December 31 of the current fiscal year:
Common stock, $25 par value (no change during the year) $5,500,000
Preferred $5 stock, $100 par (no change during the year) 3,000,000
The net income was $502,000 and the declared dividends on the common stock were $55,000 for the current year. The market price of the common stock is $13.60 per share. For the common stock
Determine:
a. the earnings per share
b. the price-earnings ratio
c. the dividends per share
d. the dividend yield.
Answer:
a. the earnings per share is $2.28
b. the price-earnings ratio is 5.96 times
c. the dividends per share is $0.25
d. the dividend yield is 1.84%
Explanation:
a. the earnings per share
Earning per share is the net earning of the company against each outstanding share.
Earning per share = Net Income / Numbers of Outstanding shares
Earning per share = $502,000 / ($5,500,000/$25)
Earning per share = $502,000 / 220,000 = $2.28
b. the price-earnings ratio
Price earning ratio determines the impact of net income on market value of the share.
Price earning Ratio = Market Pice of stock / Earning per share
Price earning Ratio = $13.60 / $2.28
Price earning Ratio = 5.96
c. the dividends per share
Dividend per share is the value of dividend paid to each outstanding common share.
Dividend per share = Dividend declared / Numbers of outstanding shares
Dividend per share = $55,000 / 220,000 shares
Dividend per share = $0.25 per share
d. the dividend yield.
Dividend yield is the ratio of dividend per share and Market price per share.
Dividend Yield = Dividend Per share / Market price per share
Dividend Yield = $0.25 / $13.60 = 0.0184 = 1.84%
Some towns limit the number of hours that liquor stores can sell alcohol on Sundays. This restriction could actually help liquor stores by
Answer: decreasing sales and increasing prices.
Explanation:
From the question, we are informed that some towns limit the number of hours that liquor stores can sell alcohol on Sundays. This restriction could actually help liquor stores reduce their sales and thereby lead to the increment of prices.
Since there has been a reduction I the number of hours, it means lesser alcohol will be sold and this can invariably lead to price increase.
Universal Travel Inc. borrowed $497,000 on November 1, 2018, and signed a 12-month note bearing interest at 4%. Interest is payable in full at maturity on October 31, 2019. In connection with this note, Universal Travel Inc. should report interest payable at December 31, 2018, in the amount of:
Answer:
Dec 31, 2018
Interest expense 3313.33 Dr
Interest Payable 3313.33 Cr
Explanation:
The note interest is payable at an annual rate of 4%. The interest will be paid at maturity however, an adjusting entry will be made on December 31, 2018 following the accrual basis of accounting to record the interest expense that relates to the period from November to December of 2018. The interest expense will be debited and as the interest will be paid at maturity, interest payable will be credited.
Interest expense = 497000 * 0.04 * 2/12 = $3313.33
ICOT Industries issued 28 million of its $1 par common shares for $492 million on April 11. Legal, promotional, and accounting services necessary to effect the sale cost $3 million. Required: 1. Prepare the journal entry to record the issuance of the shares. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)
Answer:
Dr Cash $492
Cr Common stock $28
Cr PIC in excess of par 464
Dr PIC in excess of par $3
Cr Cash $3
Explanation:
Preparation of the Journal entry to record the issuance of the shares
Based on the information given we were told that the Industries issued 28 million of its $1 par common shares for the amount of $492 million on April 11 which means that the Journal entry will be:
Dr Cash $492
Cr Common stock $28
(28 million x $1)
Cr PIC in excess of par 464
($492-$28)
(To record the sale of the stock)
Based on the information given we were told that the Industries had Legal, promotional, and accounting services necessary to effect the sale cost of the amount of $3 million which means that the Journal entry will be:
Dr PIC in excess of par $3
Cr Cash $3
(To record the stock issue costs)
Down Under Products, Ltd., of Australia has budgeted sales of its popular boomerang for the next four months as follows:
Sales in Units
April 54,000
May 75,000
June 94,000
July 82,000
The company is now in the process of preparing a production budget for the second quarter. Past experience has shown that end-of-month inventory levels must equal 20% of the following month’s sales. The inventory at the end of March was 10,800 units. Required: Prepare a production budget for the second quarter; in your budget, show the number of units to be produced each month and for the quarter in total.
down under products Ltd.
prodcution budget
april may june other
budgeted unit sales
total needs
required production in units
Answer:
Results are below.
Explanation:
Giving the following information:
Sales in Units
April 54,000
May 75,000
June 94,000
July 82,000
Desired ending inventory= 20% of the following month’s sales.
The inventory at the end of March was 10,800 units.
To calculate the production for each month, we need to use the following formula:
Production= sales + desired ending inventory - beginning inventory
April:
Sales= 54,000
Ending inventory= 75,000*0.2= 15,000
Beginning inventory= (10,800)
Total= 58,200 units
May:
Sales= 75,000
Ending inventory= 94,000*0.2= 18,800
Beginning inventory= (15,000)
Total= 78,800 units
June:
Sales= 94,000
Ending inventory= 82,000*0.2= 16,400
Beginning inventory= (18,800)
Total= 91,600 units
Total for the quarter= 228,600 units
In the above case, Sales in Units in the month of April is 54,000, in the month of May is 75,000, in the month of June is 94,000 and in the month of July is 82,000.
What is sales?A sale is defined as a transaction between the parties in which the purchaser acquires goods, services, or assets in return for money. In some cases, other assets are pay off to a seller.
Computation of production:
According to the available information,
Desirable closing inventory= 20% of the following month’s sales.
The inventory at the end of March was 10,800 units.
To calculate the production in each month, the formula is:
[tex]\text{Production= Sales + Desired Ending Inventory - Beginning Inventory}[/tex]
Production in the month of April:
According to the given information,
Sales= 54,000
Ending inventory:
[tex]=75,000\times \dfrac{20}{100}\\= 15,000[/tex]
Beginning inventory= 10,800
Now, apply the given values in the above formula:
[tex]\text{Production= Sales + Desired Ending Inventory - Beginning Inventory}\\\\\text{Production} =54,000+15,000-10,800\\\\\text{Production}=58,200\text{Units}[/tex]
Production in the month of May:
Sales= 75,000
Ending inventory:
[tex]=94,000\times \frac{20}{100}\\\\= 18,800[/tex]
Beginning inventory= 15,000
Now, apply the given values in the above formula:
[tex]\text{Production= Sales + Desired Ending Inventory - Beginning Inventory}\\\\\text{Production} =75,000+18,800-15,000\\\\\text{Production}=78,800\text{Units}[/tex]
Production in the month of June:
Sales= 94,000
Ending inventory:
[tex]872,000\times\dfrac{20}{100}= 16,400[/tex]
Beginning inventory= 18,800
Now, apply the given values in the above formula:
[tex]\text{Production= Sales + Desired Ending Inventory - Beginning Inventory}\\\\\text{Production} =94,000+16,400-18,800\\\\\text{Production}=91,600\text{Units}[/tex]
Therefore, the Total for the quarter :
[tex]=\text{May's Production + June's Production+Juily's Production}\\\\=58,200+78,800+91,600 \text{Units}\\= 228,600 \text{Units}[/tex]
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Suppose Cho is considering emigrating from her home country.A fictional country of Flaxon has the same policies and institutions as Cho's home country, except that it has greater price stability. If Cho's decision to emigrate is based solely on the prospects for economic growth, she would
Answer: Migrate to Flaxon
Explanation:
If Flaxon country has the same policies and institutions as Cho's home country but also has greater price stability, Cho would emigrate if she wanted more economic growth because Price stability contributes to the growth of the economy.
Price stability means that the country is not going to experience inflation (deflation) that is too high (low) and lasts too long as well as one that is erratic.
This benefits the economy because;
Savings will not be easily eroded by inflation.Decisions can be made easier as inflation rates can be better predictable. For instance, people can save or invest at a particular rate that they know will bring them real return as it will be over the inflation rate. Unexpected deflation will not cause companies to make losses which can increase unemployment and company shutdowns and,Financial institutions can borrow out loans at more stable rates for investments because in a less stable market they would have to charge higher rates to ensure that they do not make losses should inflation change. These stable rates will attract companies and individuals who will use the funds for investment and improve the economy.On November 7, Mura Company borrows $370,000 cash by signing a 90-day, 8%, $370,000 note payable. 1. Compute the accrued interest payable on December 31. 2. & 3. Prepare the journal entry to record the accrued interest expense at December 31 and payment of the note at maturity on February 5.
Answer:
At 31 December, the Interest for 54 days accrues as follows :
Interest expense $17,740 (debit)
Note Payable $17,740 (credit)
On payment February 5, the Interest expense will be capitalized in the Note Payable as follows :
Note Payable $407,473 (debit)
Cash $407,473 (credit)
Explanation:
AT, November 7, When Mura Company borrows the money :
Cash $370,000 (debit)
Note Payable $370,000 (credit)
At 31 December, the Interest for 54 days accrues as follows :
Interest expense $17,740 (debit)
Note Payable $17,740 (credit)
Interest expense calculation = $370,000 × 8% × 54/90
= $17,740
At February 5, the interest for 60 days accrues as follows :
Interest expense $19,733 (debit)
Note Payable $19,733 (credit)
Interest expense calculation = $370,000 × 8% × 60/90
= $19,733
On payment February 5, the Interest expense will be capitalized in the Note Payable as follows :
Note Payable $407,473 (debit)
Cash $407,473 (credit)
Note Payable Calculation = $370,000 + $19,733 + $17,740
$407,473
Ultimate Sportswear has $150,000 of 8% non-cumulative, non-participating, preferred stock outstanding. Ultimate Sportswear also has $550,000 of common stock outstanding. In the company's first year of operation, no dividends were paid. During the second year, the company paid cash dividends of $35,000. This dividend should be distributed as follows:
a. $8,750 preferred: $26,250 common.
b. $0 preferred: $35,000 common.
c. $12.000 preferred: $23.000 common.
d. $19.000 preferred: $16.000 common
e. $17,500 preferred; $17,500 соmmоn.
Answer:
c. $12,000 preferred: $23,000 common
Explanation:
Calculation of how the Dividend should be distributed
First step is to calculate for preferred stock outstanding
Preferred stock outstanding=$150,000 * 8% non-cumulative
Preferred stock outstanding=$12,000
Second step is to calculate for common stock outstanding
Using this formula
Common stock outstanding = Cash Dividend-Preferred stock outstanding
Let plug in the formula
Common stock outstanding=$35,000-$12,000
Common stock outstanding=$23,000
Therefore Preferred stock outstanding will be $12,000 while Common stock outstanding will be $23,000
n January 1, 1987, three 100 par value bonds with 6% annual coupons will mature at the end of 1, 2, and 3 years, respectively. The redemption value of each bond is 100. You are given that the prices for these bonds on January 1, 1987 are: Maturity Date Price December 31, 1987 101.92 December 31, 1988 102.84 December 31, 1989 105.51 These prices are based on an interest rate of i in 1987, j in 1988, and k in 1989. Determine j.
Answer:
j = 4.52%
Explanation:
face value = $100, with 6% annual coupons
bond₁ matures in 1 year (December 31, 1987), market price $101.92
bond₂ matures in 2 years (December 31, 1988), market price $102.84
bond₃ matures in 3 years (December 31, 1989), market price $105.51
we must determine the market interest rate (j) for bond₂, and to do this we will use the approximate yield to maturity formula:
YTM = {coupon + [(face value - market price)/n]} / [(face value + market price)/2]
YTM = {6 + [(100 - 102.84)/2]} / [(100 + 102.84)/2] = 4.58 / 101.42 = 0.045158 = 4.52%
Since the bonds are sold at a premium, it means that the coupon rate is higher than the market rate.
Kelley Company reports $1,250,000 of net income for 2017 and declares $175,000 of cash dividends on its preferred stock for 2017. At the end of 2017, the company had 380,000 weighted-average shares of common stock. 1. What amount of net income is available to common stockholders for 2017
Answer:
Net income available to common stockholders is $1,075,000
Explanation:
Net Income $1,250,000
To Preferred Shareholders $175,000
Net income available to $1,075,000
common stockholders
Basic earnings per share = Net income available to common stockholders / weighted average shares of common stock
Basic earnings per share = $1,075,000 / 380,000
Basic earnings per share = $2.8290 per share.
ignoring taxes what is the effect on earnings in the year after the shares are granted to executives
Answer: C. $40 million.
Explanation:
By granting them 15 million shares subject to forfeiture if employment is terminated within three years, the company is compensating them.
The total amount that they will be compensated with has to be apportioned over the 3 years as an expense that will reduce earnings per year.
Total compensation = No. of shares * fair value of shares
= 15,000,000 * 8
= $120,000,000
Apportioned over 3 years;
= 120,000,000/3
= $40,000,000
Suppose a jar of orange marmalade that is ultimately sold to a customer at The Corner Store is produced by the following production process: Name of Company Revenues Cost of Purchased Inputs Citrus Growers Inc. $0.75 0 Florida Jam Company $2.00 $0.75 The Corner Store $2.50 $2.00 What is the value added of Florida Jam Company
Answer:
$1.75
Explanation:
Value added is calculated by subtracting the difference of revenue and the cost of inputs.
value added of Florida Jam Company = $2.50 - $0.75 = $1.75
Simon Corporation manufactures hydraulic valves. The product life of a valve is 4 years. Target average profit margin for Simon 20.00% The company does not expect the manufacturing cost to vary over the next 4 years. Estimated sales volume and the unit selling price of the valve for the next 4 years is given below: Year Sales volume (units) Unit selling price Year 1 40,000 $80.00 Year 2 50,000 $75.00 Year 3 35,000 $50.00 Year 4 25,000 $45.00 What is the allowable unit cost of a hydraulic valve using the target costing model
Answer:
Allowable unit cost of a hydraulic valve using the target costing model = 52.4
Explanation:
Given that:
Simon Corporation manufactures hydraulic valves. The product life of a valve is 4 years.
Target average profit margin for Simon 20.00%
The company does not expect the manufacturing cost to vary over the next 4 years
Estimated sales volume and the unit selling price of the valve for the next 4 years is given below:
Year Sales volume (units) Unit selling price
Year 1 40,000 $80.00
Year 2 50,000 $75.00
Year 3 35,000 $50.00
Year 4 25,000 $45.00
The objective is to determine the allowable unit cost of a hydraulic valve using the target costing model.
The Cost for each unit selling price can be calculated as:
= unit selling price - (Target average profit margin × unit selling price)
For Year 1
= $80.00- (0.2 × $80.00)
= $80.00 - $16.00
= $64.00
For Year 2
= $75.00 - ( 0.2 × $75.00)
= $75.00 - ( $15.00)
= $60.00
Year 3
= $50.00 - (0.2× $50.00)
= $50.00 - $10.00
= $40.00
Year 4
= $45.00 - (0.2 × $45.00)
=$45.00 - $9.00
= $36.00
Year Sales volume Unit Cost Cost per Unit
(units) selling price
Year 1 40,000 $80.00 $64.00 $2560000
Year 2 50,000 $75.00 $60.00 $3000000
Year 3 35,000 $50.00 $40.00 $1400000
Year 4 25,000 $45.00 $36.00 $900000
Total: 150000 $7860000
Allowable unit cost = Total cost/Total number of unit cost
Allowable unit cost = $7860000/150000
Allowable unit cost = 52.4
Northwest Fur Co. started 2021 with $105,000 of merchandise inventory on hand. During 2021, $510,000 in merchandise was purchased on account with credit terms of 3/15, n/45. All discounts were taken. Purchases were all made f.o.b. shipping point. Northwest paid freight charges of $8,900. Merchandise with an invoice amount of $3,700 was returned for credit. Cost of goods sold for the year was $362,000. Northwest uses a perpetual inventory system. What is ending inventory assuming Northwest uses the gross method to record purchases
Answer:
The ending inventory by using the gross method is $243,011
Explanation:
Purchases = Net purchases + Freight inwards
Purchases = 491,111 + 8,900
Purchases = 500,011
When Net purchase = Gross Purchase - Purchase return - Discount
Net purchase = 510,000 - 3,700- 15,189
Net purchase = 491,111
Working
Discount = (Purchases - Purchase return) × Discount rate
Discount = (510,000 - 3,700) * 3%
Discount = 15,189
Ending inventory = Beginning inventory + Purchases− Cost of good sold
Ending inventory = (105,000 + 500,011) - 362,000
Ending inventory = $243,011
Thus, the ending inventory by using the gross method is $243,011.
Explain how growth in the demand for Australia's natural resources would affect the demand for Australian dollars in the foreign exchange market. Explain how the supply of Australian dollars would change.
Answer:
The question here is that of the balance of trade and the principles of demand and supply.
According to the Economics principles of demand and supply, when demand is high, prices follow in the same direction and the currency appreciates in value.
So, on one hand, when the demand for Australia's natural resources increases, because the legal tender recognised within Australia's borders is its own currency, trading partners are forced to convert from their currency into the Australian dollars thus creating an increased demand for the currency.
On the other hand, if the value of a countrys imports is more than the value of its export transactions, the opposite would happen, that is, its currency depreciates or loses value.
Cheers!
Item9 2 points Time Remaining 2 hours 55 minutes 49 seconds02:55:49 eBookItem 9Item 9 2 points Time Remaining 2 hours 55 minutes 49 seconds02:55:49 TB MC Qu. 6-143 Keyser Corporation, which has... Keyser Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $ 118 Units in beginning inventory 400 Units produced 2,100 Units sold 2,300 Units in ending inventory 200 Variable costs per unit: Direct materials $ 37 Direct labor $ 23 Variable manufacturing overhead $ 3 Variable selling and administrative expense $ 5 Fixed costs: Fixed manufacturing overhead $ 73,500 Fixed selling and administrative expense $ 29,900 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. What is the net operating income for the month under variable costing?
Answer:
Results are below.
Explanation:
Giving the following information:
Selling price $118
Units sold 2,300
Variable costs per unit:
Direct materials $37
Direct labor $23
Variable manufacturing overhead $3
Variable selling and administrative expense $5
First, we need to determine the total unitary variable cost:
Unitary variable cost= 37 + 23 + 3 + 5=$68
Variable cost income statement:
Sales= 2,300*118= 271,400
Total variable cost= 68*2,300= (156,400)
Total contribution margin= 115,000
Fixed manufacturing overhead= (73,500)
Fixed selling and administrative expense= (29,900)
Net operating income= 11,600
Cameroon Corp. manufactures and sells electric staplers for $15.30 each. If 10,000 units were sold in December, and management forecasts 3.3% growth in sales each month, the number of electric stapler sales budgeted for March should be:
Answer:
Electric stapler sales budgeted for March should be: 11,023 units.
Explanation:
Apply the growth of 3.30% to each month starting December as follows :
December Sales = 10,000 units
January Sales = 10,000 × (1.033)^1 = 10,330 units
February Sales = 10,000 × (1.033)^2 = 10,671 units
March Sales = 10,000 × (1.033)^3 = 11,023 units
The accounting principle that requires important noncash financing and investing activities be reported on the statement of cash flows or in a footnote is the:\
Answer: Full Disclosure Principle
Explanation:
The Full Disclosure Principle is a principle in Accounting that aims to be keep the relevant business information as transparent as possible. The principle therefore requires that all information relating to the business be disclosed so that the stakeholders in the business will be able to reasonably understand the operations of the business.
As only financial data can be reported in financial statements such as cash related activities in the Cashflow Statement, the principle requires that important noncash financing and investing activities be reported on the statement of cash flows or in a footnote so that the readers of the statement will not have any missing information.
