Answer:
5%
Explanation:
Net income is $15,000
Sales is $300,000
The profit margin can be calculated as follows
= 15,000/300,000
= 0.05×100
= 5%
Profit margin is 5%
Calculate the total Social Security and Medicare tax burden on a sole proprietorship earning 2020 profit of $300,000, assuming a single sole proprietor with no other earned income.
Answer: $25,802.70
Explanation:
Social security
Social security rates in 2020 for a single sole proprietor is 12.40% on the first $137,700:
= 12.40% * 300,000
= $17,074.80
Medicare Tax
First you need to remove a deduction of 7.65% from the income:
= 300,000 * (1 - 7.65%)
= $277,050
Medicare tax is 2.90% of this adjusted amount in addition to 0.9% for any amount above $200,000:
= (2.90% * 277,050) + (0.9% * (277,050 - 200,000))
= 8,034.45 + 693.45
= $8,727.90
Total Social security and Medicare:
= 17,074.80 + 8,727.9
= $25,802.70
TB MC Qu. 08-156 Fortune Drilling Company acquires... Fortune Drilling Company acquires a mineral deposit at a cost of $5,900,000. It incurs additional costs of $600,000 to access the deposit, which is estimated to contain 2,000,000 tons and is expected to take 5 years to extract. What journal entry would be needed to record the expense for the first year assuming 418,000 tons were mined
Answer:
Fortune Drilling Company
Journal Entry:
Debit Depletion Expense $1,350,000
Credit Accumulated Depletion $1,350,000
To record the first year's expense.
Explanation:
a) Data and Calculations:
Acquisition cost of mineral deposit = $5,900,000
Additional costs incurred = $600,000
Total costs of mine = $6,500,000
Estimated mineral deposit = 2,000,000 tons
Estimated years of extraction = 5 years
First year's extraction quantity = 418,000
Expenses for the first year = 418,000/2,000,000 * $6,500,000
= $1,350,000
Analysis:
Depletion Expense $1,350,000 Accumulated Depletion $1,350,000
A company must repay the bank $10,000 cash in three years for a loan. The loan agreement specifies 8% interest compounded annually. The present value factor for three years at 8% is 0.7938. How much cash did the company receive from the bank on the day they borrowed this money?
A. $12,400.
B. $9,200.
C. $7,938.
D. $7,600.
E. $10,000.
Answer: C. $7,938
Explanation:
This is a straightforward question. From the question, we are informed that a company must repay the bank $10,000 cash in three years for a loan and that the loan agreement specifies 8% interest compounded annually and we are given the present value factor for three years at 8% is 0.7938.
Therefore, the amount of cash that the company receive from the bank on the day they borrowed this money will be:
= $10000 × Present value factor at 8%
= $10000 × 0.7938
= $7938
Use the following information about the current year's operations of a company to calculate the cash paid for merchandise.
Cost of goods sold……………………………….. $ 735,000
Merchandise inventory, January 1………………. 84,700
Merchandise inventory, December 31…………… 82,400
Accounts payable, January 1……………………. 54,500
Accounts payable, December 31……………….. 60,200
Answer:
$727,000
Explanation:
Calculation of cash paid for merchandise
Cost of goods sold
$735,000
Add:
Merchandise inventory, December 31
$82,400
Less:
Merchandise inventory, January 1
($84,700)
Purchases during the period
$732,700
Add:
Accounts payable, January 1
$54,500
Less:
Accounts payable, December 31
($60,200)
Cash paid for merchandise
$727,000
Budgeted Actual Overhead cost $909,000 $884,000 Machine hours 55,000 46,000 Direct labor hours 101,000 98,000 Overhead is applied on the basis of direct labor hours. (a) Compute the predetermined overhead rate. (Round answer to 2 decimal places, e.g. 12.25.)
Answer:
Missing word "(b) Determine the amount of overhead applied for the year?"
1. Predetermined overhead rate = Budgeted overhead / Budgeted direct labor hours
Predetermined overhead rate = $909,000 / 101,000
Predetermined overhead rate = $9 per DLH
2. Overhead applied = Actual hours * Overhead rate
Overhead applied = 98,000 * $9 per DLH
Overhead applied = $882,000
You made an investment of $15,000 into an account that paid you an annual interest rate of 3.8 percent for the first 8 years and 8.2 percent for the next 10 years. What was your annual rate of return over the entire 18 years
Answer: 6.22%
Explanation:
To find the annual rate of return, find the geometric mean of the returns:
= ¹⁸√ (1 + 3.8%)⁸ * (1 + 8.2%)¹⁰ - 1
= ¹⁸√ 2.9638173484126186153 - 1
= 1.0622187633434 - 1
= 6.22%
Janice has been invited to appear on a home improvement show for the remodel of her summerhouse in Maine. Janice asks Mary to wallpaper her house in anticipation of the home improvement, and requests expensive custom wallpaper and a very intricate design application, for which the wallpaper would cost $5000, plus labor. Mary, excited for a very large job for her solo business, orders the intricate wallpaper and blocks off her calendar for the amount of time it will take to complete the job. After the paper has been ordered, Mary asks some friends to be available to complete the job in time for the show. Janice is informed that she will not be on the show and notifies Mary that she will not need the wallpaper.
a. Does Mary have a case for re-imbursement?
b. Under what legal theory might she prevail and what are her damages, if any?
c. What ethical theories might be applicable?
Answer:
sorry I don't know.
Explanation:
Yes, Mary has a legal cause of reimbursement Under the legal theory of ethical violation.
What is ethical violation?A documented company's code of ethics, mission, vision, values, and culture are violated when something is spoken, published, or done that does so. Additionally, we are aware that moral transgressions laugh in the face of accepted social norms.
Most business professionals' ethical conduct is governed by codes of conduct. Business infractions including discrimination, safety issues, or poor working conditions are most frequently observed.
Additionally, fraud, theft, and conflicts of interest. Many of these cross the line into illegal territory that is dealt with outside the corporation and are not merely morally bad.
Customers may be charged for services they did not receive when there is improper or fraudulent billing. This occurs most frequently in professions where the person who pays the bill is different from the person who received the services.
Due to the frequency of this particular ethical breach, many insurance companies have started providing consumers with a list of services that may fall under this category, enticing them to report any irregularities.
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In the process of conversion from the equity method to the fair value method, the earnings or losses that the investor previously recognized under the equity method should
Answer: remain as a part of the carrying amount of the investment
Explanation:
Equity method is simply the process whereby investments are treated in associate companies. It usually occurs when the investor entity holds about twenty to fifty percent of the voting stock of the other company.
It should be noted that in a process of conversion from the equity method to the fair value method, the earnings or losses that the investor previously recognized under the equity method should remain as a part of the carrying amount of the investment.
The Chiemsee Knee Replacement Clinic (CKRC) is a sports clinic located at the northern edge of the German Alps. It specializes in knee replacements for skiers who come to CKRC from Germany, Austria, Switzerland, and Italy. The clinic currently has one operating room (OR). However, since the clinic has dramatically more demand than capacity, the management team contemplates investing in a second OR. A lean consulting firm, however, suggests that before going ahead with installing new capacity, the clinic should first look at how it uses its existing capacity. The data collected by the consulting firm reveal that:
The OR is available for 12 hours a day; the hospital has decided to not perform any procedures between 7pm and 7am. This time is equally divided across three surgeons.
The standard procedure time for the knee surgery done at the clinic is 1h.
The cleaning and housekeeping that needs to happen after each procedure takes 20 minutes. Almost all of this time could be saved if the cleaning crew were notified earlier on.
10 minutes are spent on patient preparation / anesthesia work before each procedure. (Note: this is not part of the 60-minute procedure time). Proposals have been evaluated to move these 10 minutes to outside the OR, and there exists no medical reason that would prohibit doing this.)
A surgeon only starts a case if all of the work associated with the case (preparation, procedure, and cleaning) can be completed in the 4h allotted to each surgeon. Surgeons never start BEFORE their allotted time.
Though the clinic aims to operate 7 days a week, holidays, vacation, and construction time lead to an average of one day a week that the OR cannot be used at all.
What is the OEE of the operating room? Assume a 12h window in which the OR could be used.
The OEE of the Operating Room is 34.8%.
Operating Room Overall Equipment EffectivenessTo calculate the OEE (Overall Equipment Effectiveness) of the OR, you need to consider three factors: availability, performance, and quality.
Availability: The OR is available for 12 hours a day, but there is a 1 hour window between 7pm and 7am when it is not used. Additionally, there is an average of one day a week when the OR cannot be used at all. Therefore, the availability is:(12 hours - 1 hour) / 12 hours * 7 days/week - 1 day/week = 0.92 or 92%
Performance: The standard procedure time for the knee surgery is 1 hour, and 10 minutes are spent on patient preparation and anesthesia work. The cleaning and housekeeping takes 20 minutes, and a surgeon only starts a case if all of the work can be completed in the 4 hours allotted to each surgeon. Therefore, the performance is:1 hour + 10 minutes + 20 minutes = 1 hour and 30 minutes / 4 hours = 0.375 or 37.5%
Quality: Quality is not mentioned in the data provided, so it is assumed to be 100%.To calculate OEE, you need to multiply availability, performance, and quality:
OEE = availability * performance * quality = 0.92 * 0.375 * 1 = 0.348 or 34.8%
So, the OEE of the OR is 34.8%.
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ctivity-Based Costing (ABC) is useful in: Select one: A. Breakdown COGS into DL, DM, and FOH B. Breaking down FOH more accurately into cost drivers C. Breaking down FOH into one overhead rate D. Breaking down DL and DM by product
Answer:
B. Breaking down FOH more accurately into cost drivers
Explanation:
In the case of activity based costing, the activity of the fixed cost should be breakdown based on the number of activity pools while the fixed cost should be breakdown as per the cost drivers. Also, there is more than one overhead rate existed. In addition to this, it is the method for distribution of the overhead with those firms who is able to used it
Therefore the option b is correct
Welcome Inn Hotels is considering the construction of a new hotel for $90 million. The expected life of the hotel is 30 years, with no residual value. The hotel is expected to earn revenues of $26 million per year. Total expenses, including depreciation, are expected to be $15 million per year. Welcome Inn management has set a minimum acceptable rate of return of 14%.
a. Determine the equal annual net cash flows from operating the hotel.
b. Calculate the net present value of the new hotel. Use 7.003 for the present value of an annuity of $1 at 14% for 30 periods.
c. Does your analysis support construction of the new hotel?
Answer:
a. Annual Net cash flows:
= Revenue - Expenses + Depreciation
= 26,000,000 - 15,000,000 + (90,000,000 / 30 years)
= 11,000,000 + 3,000,000
= $14,000,000
b. Net present value:
= Present value of cashflows - Investment cost
= (Annual cashflow * present value of an annuity, 14%, 30 periods) - Investment cost
= (14,000,000 * 7.003) - 90,000,000
= $8,042,000
c. Company should construct the hotel as it would bring a positive Net Present Value
Note: In "b" the cashflow was treated as an annuity because it is constant.
On January 1, Baker Co. purchased equipment for $100,000. It has an estimated useful life of five years and its residual value is $10,000. The company has a calendar year-end. Using the straight-line method, depreciation expense for the first year of its life equals:
Answer:
Explanation:
No dia do meu aniversário caraaaa
Brown Co. issued $100 million of its 10% bonds on April 1, 2016, at 99 plus accrued interest. The bonds are dated January 1, 2016, and mature on December 31, 2035. Interest is payable semiannually on June 30 and December 31. What amount did Brown receive from the bond issuance?
a) $87.8 million
b) $99.0 million
c) $100.0 million
d) $101.5 million
Answer:
d) $101.5 million
Explanation:
The computation of the amount received from the bond issuance is given below:
Interest Rate: 10%
Time period: 3 months (from 01.01.2016 to 31.03.2016)
Par Value=$100 million
Accrued Interest be 2.53 million
So,
Amount receive from Bond Issuance is
= 99 + 2.53
= $101.5 million
Sandoval needs to determine its year-end inventory. The warehouse contains 33,000 units, of which 4,300 were damaged by flood and are not sellable. Another 3,300 units were purchased from Markor Company, FOB shipping point, and are currently in transit. The company also consigns goods and has 5,300 units at a consignee's location. How many units should Sandoval include in its year-end inventory
Answer:
37,300
Explanation:
Calculation to determine How many units should Sandoval include in its year-end inventory
Using this formula
Year-end inventory units=(Warehouse units- Damaged units)+ Units purchased+ Units at consignee's location
Let plug in the formula
Year-end inventory units=(33,000 - 4,300) +3,300+5,300
Year-end inventory units=28,700+3,300+5,300
Year-end inventory units=37,300
Therefore How many units should Sandoval include in its year-end inventory is 37,300
Burlington Construction Company is considering selling excess machinery with a book value of $281,000 (original cost of $400,100 less accumulated depreciation of $119,100) for $277,400, less a 5% brokerage commission. Alternatively, the machinery can be leased for a total of $284,300 for five years, after which it is expected to have no residual value. During the period of the lease, Burlington Construction Company's costs of repairs, insurance, and property tax expenses are expected to be $25,000.
Required:
Prepare a differential analysis, dated January 3, 2012, to determine whether Sure-Bilt should lease (Alternative 1) or sell (Alternative 2) the machinery.
Answer:
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Slavery, as a business practice protected by state laws, provided unfair advantage against those employers not using slaves, and thus the economic incentives supported and sustained slavery within its sealed environment.
A. True
B. False
Journal Entry
On November 1, the company rented space to another tenant. A check in the amount of $9,000, representing three months' rent in advance, was received from the tenant on that date. The payment was recorded with a credit to the Unearned Rent account. Complete the necessary adjusting entry for December 31 by selecting the account names and dollar amounts from the drop-down menus.
Date Account Title Debit Credit
Dec. 31 selectAccounts ReceivableAccumulated DepreciationCashDepreciation ExpenseEquipmentEquipment ExpenseRent RevenueSalaries ExpenseSalaries PayableService RevenueSuppliesSupplies ExpensesUnearned Rent Revenue select300060009000 select300060009000
selectAccounts ReceivableAccumulated DepreciationCashDepreciation ExpenseEquipmentEquipment ExpenseRent RevenueSalaries ExpenseSalaries PayableService RevenueSuppliesSupplies ExpensesUnearned Rent Revenue select300060009000 select300060009000
Answer:
Explanation:
unearned rent 6000 (debit)
Rent revenue. 6000 (credit)
to record 2 months of realized rent revenue
True or false: Interest expense and income tax expense are considered general and administrative expenses and, therefore, are included on the general and administrative expense budget. True false question. True False
Answer: True
Explanation:
Interest expense and income tax expenses generally are stand-alone expenses but they fall under general and administrative expenses required to run the business.
Interest expense is charged on debt that was taken to run the company so will be an admin expense and tax is part of the expenses that a company has to take care of in order to run the company so it is an admin expense as well.
On July 1, Sterns Co. acquired patent rights for $36,000. The patent has a useful life of 6 years and a legal life of 15 years.
Required:
Journalize the adjusting entry on December 31 to recognize the amortization. Refer to the Chart of Accounts for exact wording of account titles.
Answer:
Dr Amortization Expense $3,000
Cr Patents $3,000
Explanation:
Preparation of the journal adjusting entry on December 31 to recognize the amortization.
Dec. 31
Dr Amortization Expense $3,000
Cr Patents $3,000
(To record Amortization)
Amortization=(Patent rights/Useful life)*6/12
Amortization=($36,000/6)*6/12
Amortization=$3,000
(July 1 to Dec 31 =6months)
pls help me with in this i just want the 3 and 4th one...
Answer:
3. The special concept reminded by the phrase "Exchanging Butter Cake for Dates" is:
Trade by barter.
4. The need fulfilled by this business is people's demand for Cake.
The want fulfilled by this business is the organization's supply of dates for its production of cake.
Explanation:
A trade by barter involves the exchange of one good or service by one trading party for another good or service from the coincidental trading party without the use of money or monetary mediums. Trade by barter enables people without money to fulfill their needs. The major problem with trade by barter is that there must be coincidence of wants by the two trading partners. This is not always feasible.
QS 8-4 Units-of-production depreciation LO P1 On January 1, the Matthews Band pays $65,800 for sound equipment. The band estimates it will use this equipment for four years and perform 200 concerts. It estimates that after four years it can sell the equipment for $2,000. During the first year, the band performs 45 concerts. Compute the first-year depreciation using the units-of-production method.
Answer:
$14,355
Explanation:
Activity method based on output = (output produced that year / total output of the machine) x (Cost of asset - Salvage value)
(45/200) x ($65,800 - $2000) =
0.225 x 63800
$14355
A company produces a single product. Variable production costs are $12.50 per unit and variable selling and administrative expenses are $3.50 per unit. Fixed manufacturing overhead totals $41,000 and fixed selling and administration expenses total $45,000. Assuming a beginning inventory of zero, production of 4,500 units and sales of 3,850 units, the dollar value of the ending inventory under variable costing would be: Multiple Choice $10,400 $5,850 $8,125 $13,975
Answer:
the third option is correct - $8,125
Explanation:
The calculation of the ending inventory under variable costing is given below:
Ending inventory value (Variable costing) os
= Variable production cost per unit × No. of units
= $12.50 × (4,500 - 3,850)
= $8,125,
Hence, the ending inventory under variable costing is $8,125
Therefore the third option is correct
The rate of earnings is 6% and the cash to be received in 4 years is $20,000. The present value amount, using the following partial table of present
value of $1 at compound interest is
Year
6%
10%
12%
1
0.943
0.909
0.893
2
0.890
0.826
0.797
3
0.840
0.751
0.712
4
0.792
0.683
0.636
a. $12.720
Ob. $16,800
Oc. 513,660
Od. $15.840
Answer:
$15,840
Explanation:
Present value = Future value / (1 + r)^n
Rate, r = 6% = 0.06
Future value = $20,000
Number of years, n = 4
Present value = $20000 / (1 + 0.06)^4
Present value = $20000 / 1.06^4
Present value = $20,000 / 1.26247696
Present value = $15841.873
Using the partial table of present values :
Present value = Future value * PV(6%, 4)
PV at 6%, 4 years = 0.792
Present value = $20,000 * 0.792 = $15,840
Wang Co. manufactures and sells a single product that sells for $540 per unit; variable costs are $324 per unit. Annual fixed costs are $836,000. Current sales volume is $4,290,000. Management targets an annual pre-tax income of $1,215,000. Compute the unit sales to earn the target pre-tax net income.
Answer: 9,495 units
Explanation:
First find the contribution margin:
= Sales price - Variable cost
= 540 - 324
= $216 per unit
The unit sales required can be calculated by the formula:
= (Annual pre-tax income target + Fixed cost) / Contribution margin
= (1,215,000 + 836,000) / 216
= 9,495.37 units
= 9,495 units
Common property resources like fish stocks in open waters tend to be overutilized because :________.
A. the marginal social cost is always equal to the private marginal cost.
B. the marginal social cost is less than the private marginal cost.
C. the marginal social cost is greater than the private marginal cost.
D. none of the above.
Answer:
C. the marginal social cost is greater than the private marginal cost.
Explanation:
In the case when there is common property resources such as the fish stock that lies in the open waters should be overutilized as the marginal social cost should be more than the private marginal cost because if there is high utlization so it will make the problem in the environment also the cost should be borne by the present and upcoming generations
Therefore the option c is correct
Blue Spruce University sells 4,500 season basketball tickets at $140 each for its 12-game home schedule. Give the entry to record (a) the sale of the season tickets and (b) the revenue recognized after playing the first home game.
Answer:
a. Total revenue received:
= 4,500 * 140
= $630,000
Date Account Title Debit Credit
XX-XX-XXXX Cash $630,000
Unearned revenue $630,000
Revenue is unearned because the games have not been played yet therefore Blue Spruce University has not provided the service for which it was paid and has not earned the revenue.
b. The revenue per game is:
= 630,000 / 12 games
= $52,500
Date Account Title Debit Credit
XX-XX-XXXX Unearned Revenue $52,500
Revenue - Ticket Sales $52,500
Risk is a necessary ‘evil’ evil’, support this assessment and give advice risk
managers on how to resolve the effects.
For a high-risk investment, managers require a high reward.
You are the financial manager of the Crossrail 1 project in London. The Board overseeing the project, acting on behalf of the UK Government, has asked you to provide a financial analysis of the project for business planning purposes. With two years to go before the commencement of train operations, you have assembled the most recent estimates of the capital investment cost and net revenues, which were forecast 1 year ago. While the user benefits and ticket revenues are assumed to remain the same each year of the 60-year useful life, it is anticipated that maintenance costs will be higher in the final 30 years of the project. They are shown in Table.
Item of cash flow Today Each year (for the first Each year (for years
(£bn) 30 years) (£bn) 31 to 60) (£bn)
Capital investment -9.4
User benefits (Includes
Time savings, Traffic
congestion relief) 0.843 0.843
Ticket revenues 0.3 0.3
Operational costs and maintenance -0.422 -0.609
For projects such as Crossrail 1, the UK Government typically estimates a 60-year useful life and uses a discount rate of 3.5%.
a) What is the net present value (NPV) of the project?
a. "£15.04".
b. "£8.83".
c. "£7.36".
d. "£16.76".
b) What is the payback period of the project?
a. "13.04".
b. "8.22".
c. "17.60".
d. "7.49".
c) What is the internal rate of return (IRR) of the project?
a. "7.57%".
b. "7.35%".
c. "5.44%".
d. "6.52%".
d) Based on your calculations is Crossrail 1 a viable project at the discount rate?
a. "Yes".
b. "No".
You have been asked by the Board to present an analysis that incorporates more recent cash flow information about the Crossrail 1 project. Before the project becomes operational, the capital investment has been given a worse scenario estimate that is 35% above the forecast in table 1. The Board would like to see the analysis if the net cash inflows will also be 35% below expectation over the 60-year life whether under the existing hurdle rate of 3.5% it would remain viable.
a) What is the net present value (NPV) of the project?
a. "-£2.16".
b. "£4.78".
c. "£3.20".
d. "-£1.80".
b) What is the internal rate of return (IRR) of the project?
a. "2.72%".
b. "3.10%".
c. "1.79%".
d/ "0.67%".
c) Based on your calculations is Crossrail 1 a viable project at the discount rate?
a. "Yes".
b. "No".
Crossrail 1 project is about to start in London.
This project will require an initial investment of 9.4 billion. The project will start earning cash flows from year and it will continue to year 60 which is useful life of the project.
The NPV for the project will be 7.36 which is positive. The correct answer is c.
The payback period for project is 13.04 years which is given in the option a so correct answer is a.
The internal rate of return for the project is b. 7.35 .
Based on our analytics and calculation since NPV is positive so cross rail project is beneficial. The board should consider launching this project.
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explain business with two Examples
Explanation:
A business is defined as an organization or enterprising entity engaged in commercial, industrial, or professional activities. ... The term "business" also refers to the organized efforts and activities of individuals to produce and sell goods and services for profit.
Example Coca-Cola, Amazon etc.
Answer:
A business is defined as an organization or enterprising entity engaged in commercial, industrial, or professional activities. ... There are various forms of a business, such as a limited liability company (LLC), a sole proprietorship, a corporation, and a partnership
On the Tokyo Stock Exchange, Honda Motor Company stock closed at ¥2,915 per share on Monday, June 6, 2016. Honda trades as an ADR on the NYSE. One underlying Honda share equals one ADR. On June 6, 2016, the ¥/$ exchange rate was ¥107.65/$1.00. (Round your answer to 2 decimal places.) At this exchange rate, what is the no-arbitrage U.S. dollar price of one ADR?
Answer:
$27.08
Explanation:
Calculation to determine the no-arbitrage U.S. dollar price of one ADR
Using this formula
No-arbitrage U.S. dollar price of one ADR=Stock closed per share /Exchange rate
Let plug in the formula
No-arbitrage U.S. dollar price of one ADR=¥2,915 / ¥107.65
No-arbitrage U.S. dollar price of one ADR=$27.078
No-arbitrage U.S. dollar price of one ADR=$27.08 (Approximately)
Therefore the no-arbitrage U.S. dollar price of one ADR is $27.08
