Answer:
Equity will increased by 50%
Explanation:
Given:
Number of stock = 300
Per share value = $80
Stock value decline = 25%
Find:
Customer's equity will ?
Computation:
Market value = 300 × $80 = $24,000
New market value = $24000 × (100% - 25%) = $18,000
Margin = $24000 × 50% = $12,000
Credit balance = $24,000 (100% / 75%)
Credit balance = $24,000 + $12,000
Credit balance = $36,000
Equity % = [Credit balance - New market value / Credit balance]100
Equity % = [($36,000 - $18,000) / $18,000]100
Equity will increased by 50%
Which of the following is TRUE regarding a dead weight loss.
a) It refers to the loss producers incur when operating with excess capacity.
b) It is only a feature of perfectly competitive markets.
c) It only occurs when a product sells at below equilibrium price.
d) It never arises in markets where producers have market power.
Answer:
I'm pretty sure the answer is A
Barron, Inc. sold goods for on account. The company operates in a state that imposes a % sales tax. What is the amount of the sales tax payable to the state
Answer: A. $96,855
Explanation:
Sales taxes are a form of revenue for Government and are paid on certain goods and services.
The formula is;
Sales tax payable = Goods sold * Sales Tax rate
= 880,500 * 0.11
= $96,855
Pam Erickson Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2015. For tax purposes, the company employs the completed-contract method and will continue this approach in the future. (Hint: Adjust all tax consequences through the Deferred Tax Liability account.) The appropriate information related to this change is as follows.
Pretax Income from:
Percentage-of-Completion Completed-Contract Difference
2014 $752,200 $586,700 $165,500
2015 683,500 444,700 238,800
(a) Assuming that the tax rate is 30%, what is the amount of net income that would be reported in 2015?
Net income $
(b) What entry(ies) are necessary to adjust the accounting records for the change in accounting principle?
Answer:
a. $478,450
b.Dr Construction in Process $165,500
Cr Deferred tax liability $49,650
Cr Retained earnings $115,850
Explanation:
A. Calculation for the amount of net income that would be reported in 2015 for Pam Erickson Construction Company
Using this formula
Net income =(Income before income tax ) Income before income tax-Tax rate
Let plug in the formula
Net income= $683,500 - (683,500 × 30%)
Net income= $683,500 - $205,050
Net income= $478,450
B. Preparation of the Journal entry(ies) that are necessary to adjust the accounting records
For Pam Erickson Construction Company
Dr Construction in Process $165,500
Cr Deferred tax liability $49,650
($165,500 × 30%)
Cr Retained earnings $115,850
($165,500 × (100%-30%)
A company has reported operating income of $25,000,000. The bond interest expense for the year is $4,000,000 and principal payments on bonds totaled $1,000,000. The company's debt service coverage ratio is:
Answer:
The company's debt service coverage ratio is 5.
Explanation:
The debt service coverage ratio refers to the financial ratio that give a measure of the ability of a company to meet its current debts obligation.
The debt service coverage ratio therefore compares the operating income of the company with the company's total debt service obligations.
The total service obligation includes the current interest, principal repayment, and any other debt obligations.
The formula for calculating the debt service coverage ratio is given as follows:
Debt service coverage ratio = Operating income / Total debt service costs
Form the question, we have:
Operating income = $25,000,000
Total debt service costs = Interest expense + Principal payments on bonds = $4,000,000 + $1,000,000 = $5,000,000
Substituting the values into the formula, we have:
Debt service coverage ratio = $25,000,000 / $5,000,000 = 5
Therefore, the company's debt service coverage ratio is 5.
Since this is greater than 1, this iimplies that operating profits made by the company is more than enough to pay its current debt service costs.
A mail-order house uses 18,000 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price schedule applies.
Determine:
A. The optimal order quantity.
B. The number of orders per year.
of boxes: 1,000-1,999 Price per box: $1.25
of boxes: 2,000- 4,999 Price per box: $1.20
of boxes: 5,000- 9,999 Price per box : $1.15
of boxes: 10,000 or more Price per box : $1.10
Answer:
Explanation:
Given that:
A mail-order house uses 18,000 boxes a year.
Carrying costs are 60 cents per box a year =$0.60
and ordering costs are $96.
Determine:
A. The optimal order quantity.
The optimal order quantity can be calculated by using the formula:
[tex]Q_o = \sqrt{\dfrac{2DS}{H}}[/tex]
[tex]Q_o = \sqrt{\dfrac{2*18000*96}{0.60}}[/tex]
[tex]Q_o = \sqrt{\dfrac{3456000}{0.60}}[/tex]
[tex]Q_o = \sqrt{5760000}[/tex]
[tex]Q_o = 2400 \ boxes[/tex]
B. The number of orders per year.
of boxes: 1,000-1,999 Price per box: $1.25
of boxes: 2,000- 4,999 Price per box: $1.20
of boxes: 5,000- 9,999 Price per box : $1.15
of boxes: 10,000 or more Price per box : $1.10
SInce 2400 boxes lies within ''of boxes: 2,000- 4,999 Price per box: $1.20 ''
Total cost = Carrying cost + ordering cost + Purchasing cost
[tex]Total \ cost =(\dfrac{Q}{2} )H +(\dfrac{D}{Q}) S+PD[/tex]
[tex]Total \ cost =(\dfrac{2400}{2} )0.60 +(\dfrac{18000}{2400}) 96+1.20*18000[/tex]
Total cost = ( 1200) 0.60 + 7.5(96) + 1.20(18000)
Total cost = 720 + 720 + 21600
Total cost = $ 23040
If the order size is 5000, the price per box will be 1.15
[tex]Total \ cost =(\dfrac{Q}{2} )H +(\dfrac{D}{Q}) S+PD[/tex]
[tex]Total \ cost =(\dfrac{5000}{2} )0.60 +(\dfrac{18000}{5000}) 96+1.15*18000[/tex]
Total cost = 2500 (0.60) + 3.6 (96) + 20700
Total cost = 1500 + 345.6 + 20700
Total cost = $22545.6
If the order size is 10000 , the price per box will be 1.10
[tex]Total \ cost =(\dfrac{Q}{2} )H +(\dfrac{D}{Q}) S+PD[/tex]
[tex]Total \ cost =(\dfrac{10000}{2} )0.60 +(\dfrac{18000}{10000}) 96+1.10*18000[/tex]
Total cost = 5000 (0.60) + 1.8(96) + 19800
Total cost = 3000 + 172.8 + 19800
Total cost = $22972.8
From the three total cost, the least minimum cost of ordering is: 5000
So; the number of orders per year = total number of boxes per year/ boxes per order
the number of orders per year = 18000/5000
the number of orders per year = 3.6 orders per year
In which exchange rate system is the exchange rate determined entirely by the supply of and demand for a currency
Answer: Floating exchange rate system.
Explanation:
Floating exchange rate system is one in which the exchange rate is determined entirely by the supply of and demand for a currency.
In floating exchange rate system, the value of a currency fluctuates based on the happeninge that occur in the foreign exchange market.
Answer:
Managed -> exchange rate determined by both government intervention and supply and demand
Floating -> exchange rate determined by demand and supply of foreign currency
Fixed -> exchange rate pegged to the value of another nation's currency
Explanation:
What was the ratio of per capita income in each of the following countries to that in the United States in the year 2010:
a. Ethiopia
b. Mexico
c. India
d. Japan
Answer:
For Countries (per capita) United States of America (per capita)
Ethiopia:
$380 $48,468
Mexico:
$9,271 $48,468
India:
$1,358 $48,468
Japan:
$44,508 $48,468
Explanation:
Ratio per Capita also known as Gross Domestic Product per Capita (GDP Capita) is the monetary measure of the market value of all the final goods and services produced in a specific time period within the country in view. It is useful for comparing national economies of different countries on the international market.
Given the following information. Which of the statements below can you support with this information?
Maximum capacity (labor hours): 480 hours per week
Effective capacity ratio: 85 %
Actual time worked: 380 hours per week over the last two weeks
On-time delivery %: 75 percent of the jobs are being completed on time
a. More capacity needs to be added in the short term to improve performance in the system.
b. We need to look at variability in the rate at which jobs enter the shop.
c. Our workforce is not working hard enough.
d. Our workforce may be waiting on delayed arrivals of inputs needed to do the work.
Describe the reasons why you selected the specific option(s) that you did.
Answer:
d. Our workforce may be waiting on delayed arrivals of inputs needed to do the work.
Explanation:
There are two possible sources for 25% of the jobs not being delivered on time:
we have a problem with inputs required (materials or labor)we have a problem with the capacity of our facilityIf we followed Juran's Law, we can simply assume that the problem here has to do with our productive system (like 85% of production errors). Two clear problems are obvious:
only 380 hours worked out of total of 480 hours per week ⇒ why didn't anyone work during the remaining 100 hours? Is there a delay with the inputs or we don't have enough workers?only 85% of the facility's capacity is being used ⇒ why only 85% of the effective capacity ratio? If we are finishing jobs late, why do we have 15% of unused capacity?Obviously we cannot answer these questions just be reading two paragraphs, but that is what should be answered in order to solve the issues.
The Jones Company has just completed the third year of a five-year MACRS recovery period for a piece of equipment it originally purchased for $302,000. a. What is the book value of the equipment? b. If Jones sells the equipment today for $184,000 and its tax rate is 35%, what is the after-tax cash flow from selling it? c. Just before it is about to sell the equipment, Jones receives a new order. It can take the new order if it keeps the old equipment. Is there a cost to taking the order and if so, what is it? Explain. (Assume the new order will consume the remainder of the machine's useful life.) Note: Assume that the equipment is put into use in year 1.
Answer:
a. What is the book value of the equipment?
$86,976b. If Jones sells the equipment today for $184,000 and its tax rate is 35%, what is the after-tax cash flow from selling it?
($184,000 - $86,976) x (1 - 35%) = $97,024 x 65% = $63,065.60c. Just before it is about to sell the equipment, Jones receives a new order. It can take the new order if it keeps the old equipment. Is there a cost to taking the order and if so, what is it?
the cost to taking the new order is the opportunity cost of selling the equipment, which is $63,065.60.Explanation:
MACRS depreciation rate:
Year % Depreciation expense Carrying value
1 20% $60,400 $241,600
2 32% $96,640 $144,960
3 19.20% $57,984 $86,976
4 11.52% $34,790.40 $52,185.60
5 11.52% $34,790.40 $17,395.20
6 5.76% $17,395.20 $0
On November 1, Alan Company signed a 120-day, 8% note payable, with a face value of $9,000. What is the maturity value of the note on March 1
Answer:
$9,236.71
Explanation:
The computation of the maturity value of the note is shown below:-
Interest Amount = ($9000 × 8%) × 120 ÷ 365
= $720 × 120 ÷ 365
= $236.71
So, the Maturity Value is
= Face value + Interest amount
= $9,000 + $236.71
= $9,236.71
Therefore for computing the maturity value we simply applied the above formula.
Identify whether each of the following examples belongs in M1 or M2.
a. Van has $2,500 in a savings account.
b. Paolo has a $10 bill in his wallet.
c. Amy has $7,000 in a six-month certificate of deposit (CD).
Answer: The answer is given below
Explanation:
It should be noted that M1 will be derived as Currency plus the Travelers check while M2 will be M1 plus the certificate of deposit plus the money market account.
a. Van has $2,500 in a savings account.
It should be noted that money in a savings account will have to be included in M2.
b. Paolo has a $10 bill in his wallet.
This fits into the description of both M1 and M2 forms of money.
c. Amy has $7,000 in a six-month certificate of deposit (CD)
The certificate of deposit is included in the M2.
Answer:
Option A is M2
Option B is M1
Option C is M2
Explanation:
The above classifications speak to various categories of money supply.
M1 refers to the supply of money that is composed of physical currency such as notes, coins, demand deposits other checkable deposits, etc.
Simply put, M1 would include forms of money that are liquid or easy to convert into cash.
M2 and M3 which are also known as "near money" and "near, near money," are money types which cannot be converted to currency as quickly as M1.
Another example of M2 is Money Market Mutual Funds. M1 is often included when calculating for M2.
Cheers!
Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the present and proposed production approaches. If required, round percentages to one decimal place. Present Approach Proposed Approach Value-added time 23 min 23 min Non-value-added time 1,582 min 105 min Total lead time 1,605 min 1,605 min Value-added ratio (as a percent) 14 % 21 %
Answer:
Hello some parts of your question is missing attached below is the missing part
Answer : value added times : 30 minutes , 30 minutes
non-value added times: 1210 minutes, 130 minutes
Total lead times : 1240 minutes, 160 minutes
value added time as a ratio: 2.4%, 18.8%
Explanation:
Given data:
production batch sizes = 40 units
process step 1 = 6 minutes
process step 2 = 10 minutes
process step 3 = 6 minutes
process step 4 = 8 minutes
Determining : The value added, non-value added , total lead times and value added ratio under the present and proposed production approaches
UNDER PRESENT PRODUCTION APPROACH
Th value added time:
= summation of all process times = (6+10+6+8) = 30 minutes
Non-value added time:
= Value added time *(Batch size -1) + move time between each step
= 30*39+8*5
= 1170 +40 = 1210 minutes
total lead time :
= value added time + non-value added time
= 30 + 1210 = 1240 minutes
value added time as a percentage/ratio
(value added time / total lead time) * 100
= 30 / 1240 * 100 = 2.4%
UNDER PROPOSED PRODUCTION APPROACH
value added time :
= summation of all process times = (6+10+6+8) = 30 minutes
Non-value added time :
= Value added time *(Batch size -1) + time between each step
= 30*4+2*5 = 120 + 10 = 130 mins
total lead time :
= value added time + non-value added time = 30 +130 = 160 mins
value added time as a percentage/ratio:
(value added time / total lead time ) * 100
= (30 / 160) * 100 = 18.8%
Midyear on July 31st, the Digby Corporation's balance sheet reported: Total Assets of $205.498 million Total Common Stock of $6.350 million Cash of $10.050 million Retained Earnings of $44.117 million. What were the Digby Corporation's total liabilities?
a) $165.081 million.
b) $144.981 million.
c) $155.031 million.
d) $161.381 million.
Answer:
The value of total liabilities is $155.031 million and option c is the correct answer.
Explanation:
The basic accounting equation states that the total value of assets is always equal to the sum of the total value of liabilities and the total value of equity.
Thus, we can say that,
Total Assets = Total Liabilities + Total Equity
The equity part can contain various components. In the given question it has two components namely Common Stock and retained earnings.
205.498 = Total Liabilities + (6.350 + 44.117)
205.498 = Total Liabilities + 50.467
205.498 - 50.467 = Total Liabilities
Total Liabilities = $155.031
The Closed Fund is a closed-end investment company with a portfolio currently worth $200 million. It has liabilities of $3 million and 5 million shares outstanding.Required:a. What is the NAV of the fund? b. If the fund sells for $36 per share, what is its premium or discount as a percent of NAV?
Answer and Explanation:
The computation is shown below:
a. NAV of the fund is
= (Portfolio amount - liabilities) ÷ (outstanding shares)
= ($200 - $3) ÷ ($5)
= $39.40
b. The premium or discount as a percent of NAV is
= (Price - net asset value) ÷ (net asset value)
= ($36 - $39.40) ÷ ($39.40)
= -0.086
This represents the discount of 8.6%
We applied the above formulas
A company has net income of $925,000; its weighted-average common shares outstanding are 185,000. Its dividend per share is $0.70, its market price per share is $93, and its book value per share is $83.50. Its price-earnings ratio equals:
Answer:
$18.60
Explanation:
Calculation for the price-earnings ratio
Using this formula
Price-Earnings Ratio = Market Price per Share/ Earnings per share
The Earnings per share will be Net Income/(Weighted-Average Common Shares Outstanding)
Let plug in the formula
Price-Earnings Ratio = $93 / ($925,000 / 185,000)
Price-Earnings Ratio=$93/5
Price-Earnings Ratio=$18.60
Therefore the price-earnings ratio will be $18.60
You are an investor who wants to form a portfolio that lies to the right of the "optimal" minimum standard deviation portfolio on the efficient frontier. You must: 0 / 1 puntos Invest only in risky securities. Borrow money at the risk-free rate, invest in the minimum standard deviation portfolio and, in addition, only in risky securities. Borrow money at the risk-free rate and invest everything in the minimum standard deviation portfolio. Invest only in risk-free securities.
Answer:
Correct Answer:
invest in the minimum standard deviation portfolio and, in addition, only in risky securities.
Explanation:
For an investor aiming to invest in a portfolio so that, his minimum standard deviation would lie towards the optimal right, he or she would need to invest in extremely risky securities. And, also, there will be need to maintain minimum standard deviation portfolio.
Suppose you are building a scatter plot in Excel for a large amount of data. After selecting the scatter plot option, how do you enter the data into your scatter plot?
a. By manually typing each data point into the scatter plot
b. By using the Quick Styles button under the Chart menu
c. By using the Select Data button and the Select Data Source option
Answer:
c. By using the Select Data button and the Select Data Source option
Explanation:
A scatter plot is a plot which is used to plot the points of the data on the horizontal and the vertical axis also it depicts how one variable is affected by the another.
After preparing the scatter plot to enter the data in the scatter plot we need to use the data button and then data source option so that the data could be entered in the scatter plot
hence, option c is correct
Which one of the following statements is correct concerning the concept of materiality?
a. Materiality is determined by reference to guidelines established by the AICPA.
b. Materiality depends only on the dollar amount of an item relative to other items in the financial statements.
c. Materiality depends on the nature of an item rather than the dollar amount.
d. Materiality is a matter of professional judgement.
Answer:
D) Materiality is a matter of professional judgement
Explanation:
There is a 3 percent defect rate at a specific point in a production process. If an inspector is placed at this point, all the defects can be detected and eliminated. The inspector would cost $8 per hour and could inspect units in the process at the current production rate of 30 per hour. If no inspector is hired and defects are allowed to pass this point, there is a cost of $10 per defective unit to correct the defects later on. Assume that the line will operate at the same rate (i.e., the current production rate) regardless of whether the inspector is hired or not. a. If an inspector is hired, what will be the inspection cost per unit? (Round your answer to 3 decimal places.) Cost per unit $ b. If an inspector is not hired, what will be the defective cost per unit? (Round your answer to 3 decimal places.) Cost per unit $ c. Should an inspector be hired based on costs alone? Yes No
Answer:
1a. $2.67 cost per unit
1b. $0.3 cost per unit
1c. Yes
Explanation:
1a. Calculation for what will be the inspection cost per unit If an inspector is hired
The following details were given in the question.
Defective average =3/100= 0.03
inspection rate = 30 per hour
Cost of inspector = 8 per hour
Correction cost = $10 each
Using this formula
Hired inspector =Cost per hour/Current production rate per hour
Let plug in the formula
Hired inspector=8 per hour/30 rate per hour
Hired inspector =0.267×100
Hired inspector=$2.67 cost per unit
1b. Calculation for what will be the defective cost per unit If an inspector is not hired
Using this Formula
No inspector=Defect rate %/Cost per defective
Let plug in the formula
No inspector= 3/100×$10
No inspector= $0.3 cost per unit
1c. Based on the above calculation the inspector should be hired.
A company had a beginning balance in retained earnings of $424,000. It had net income of $62,000 and paid out cash dividends of $67,000 in the current period. The ending balance in retained earnings equals:
Answer:
$419,000
Explanation:
Calculation for A company ending balance in retained earnings
Beginning balance $ 424,000
Add Net income $62,000
Less Cash dividends (67,000)
Ending Retained earning balance $ 419,000
Therefore A company ending balance in retained earnings will be $419,000
Firm J has net income of $77,605, sales of $935,000, and average total assets of $467,500. Required: Calculate Firm J’s margin, turnover, and return on investment (ROI).
Answer:
Firm J's margin= 8.3%
Firm J's turnover= 2
Firm J's ROI= 16.6%
Explanation:
Form J has a net income of $77,605
The sales is $935,000
The average total assets is $467,500
Firm J's margin can be calculated as follows
Margin= Net income/sales
= $77,605/$935,000
= 0.083×100
= 8.3%
Firm J's turnover can be calculated as follows
Turnover= Sales/Average Total assets
= $935,000/$467,500
= 2
Firm J's return on investment can be calculated as follows
ROI= Net income/Average Total assets
= $77,605/$467,500
= 0.166×100
= 16.6%
Hence Firm J's margin, turnover and return on investment is 8.3%, 2 and 16.6% respectively.
This year Baldwin achieved an ROE of 5.9%. Suppose management takes measures that increase Asset turnover (Sales/Total Assets) next year. Assuming Sales, Profits, and financial leverage remain the same, what effect would you expect this action to have on Baldwin's ROE
Answer:
ROE will increase
Explanation:
This action will cause an increase in Baldwin's ROE
ROE is the same as return on Equity. The return on equity is equal to the net profit margin multiplied by asset turnover which is also multiplied by equity multiplier.
From the above, if asset turnover is being increased by measures taken by the management, the ROE will also have to increase too. Firms will have to be generating more sales per units of the assets that they own.
A piece of equipment (Asset class 15.0) was purchased by the Jones Construction Company. The cost basis was $300,000. Determine the ADS and GDS depreciation deduction for this property each year
Answer:
Alternative depreciation system (ADS depreciation) per year:
Year % depreciation expense
1 8.32% $24,960
2 16.67% $50,010
3 16.67% $50,010
4 16.67% $50,010
5 16.67% $50,010
6 16.67% $50,010
7 8.33% $24,990
General depreciation system (GDS depreciation) or MACRS per year:
Year % depreciation expense
1 20% $60,000
2 32% $96,000
3 19.20% $57,600
4 11.52% $34,560
5 11.52% $34,560
6 5.76% $17,280
New Harvest Bakery acquired all the outstanding common stock of Red Rock Bakery for $69,300 in cash. The book values and fair values of Red Rock's assets and liabilities were as follows: Book Value Fair Value Current assets $ 28,700 $ 22,300 Property, plant, and equipment 47,800 52,600 Other assets 3,500 5,800 Current liabilities 15,100 14,900 Long-term liabilities 29,000 21,400 Calculate the amount paid for goodwil
Answer:
Amount paid for goodwill is $24,900
Explanation:
Note: The data in the question are merged and they first sorted before answering the question as follows:
Book Value Fair Value
Current assets $ 28,700 $ 22,300
Property, plant, and equipment 47,800 52,600
Other assets 3,500 5,800
Current liabilities 15,100 14,900
Long-term liabilities 29,000 21,400
The explanation of the answer to the question are now provided as follows:
Generally, goodwill refers to an intangible asset of a company and it can be in different for such as intellectual property, brand, commercial secrets, and reputation.
Amount paid for goodwill of an acquired company can be estimated by deducting the fair value of net identifiable assets acquired from the consideration paid.
For this question, fair value of net identifiable assets can be calculated as follows:
Particular Fair Value ($)
Current assets 22,300
Property, plant, and equipment 52,600
Other assets 5,800
Current liabilities (14,900)
Long-term liabilities (21,400)
Fair value of net asset 44,400
Therefore, we have:
Amount paid for goodwill = Cash consideration paid - Fair value of net asset = $69,300 - $44,400 = $24,900
A couple thinking about retirement decide to put aside $3,000 each year in a savings plan that earns 8% interest. In 5 years they will receive a gift of $10,000 that also can be invested. a. How much money will they have accumulated 30 years from now
Answer:
Total future value= $408,334.38
Explanation:
Giving the following information:
A couple thinking about retirement decide to put aside $3,000 each year in a savings plan that earns 8% interest. In 5 years they will receive a gift of $10,000 that also can be invested.
First, we will determine the future value of the annual deposit investment. We need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
FV= {3,000*[(1.08^30) - 1]} / 0.08
FV= $339,849.63
Now, for the $10,000:
FV= PV*(1+i)^n
FV= 10,000*(1.08^25)
FV= $68,484.75
Total future value= 339,849.63 + 68,484.75
Total future value= $408,334.38
You are the newly assigned project manager to a major IT upgrade project in your global company. How will you determine the risk tolerances associated with your project
Answer:
I have to identify the risk factors in the project and then gauge the willingness of the company to take such risks.
Explanation:
Risk tolerance is the willingness of an organization or an individual to take certain risks. The risk tolerance level of a person or organization can be classified as either high or low. For a project manager who wants to determine the risk tolerances associated with his project, he has to first identify the risk factors, and then try to know the risk level and if indeed this level is acceptable within the organization's culture and standard.
The project manager would do well to plot a graph that would show the probability of a risky action happening or not. A risk tolerance line is now obtained from where the project manager can know if that risk is tolerable by organization standards. The extent of job security would also help in determining the amount of risk a manager can take. However, they are still expected to stay within the standards of the organization.
Graham Motors manufactures specialty tractors. It has two divisions: a Treactor Division and a Tire Division. The Tractor Division can use the tires produced by the Tire Division. The market price per tire is $75. The Tire Division has the following costs per tire:Direct material cost per tire: $15Conversion costs per tire: $3 (Assume the $3 includes only the variable portion of conversion costs.)Fixed manufacturing overhead cost for the year is expected to total $116,000. The Tire Division expects to manufacture 58,000 tires this year. The fixed manufacturing overhead per tire is $2 ($116,000 divided by 58,000 tires).Assume that the Tire Division has excess capacity, meaning that it can produce tires for the Tractor Division without giving up any of its current tire sales to outsiders. If Graham Motors has a negotiated transfer price policy, what is the lowest acceptable transfer price? What is the highest acceptable transfer price?• The lowest acceptable transfer price is $_______, the Tire Division's ______________.• The highest acceptable transfer price is $_______, the Tire Division's _____________.
Answer:
The LOWEST acceptable transfer price is $18 the Tire Division's variable cost per tire.
The HIGHEST acceptable transfer price is $75the Tire Division's market price.
Explanation:
Calculation for the lowest acceptable transfer price and the highest acceptable transfer price
Variable Cost per tire:
Direct Material $15
Conversion cost $3
=$18 per tire
The LOWEST acceptable transfer price is $18 Tire division variable cost per tire
Based on the information we were told that the market price per tire is $75 which means that the HIGHEST transfer price is $75 tire division market price.
Therefore If Graham Motors has a negotiated transfer price policy The LOWEST acceptable transfer price is $18 the Tire Division's variable cost per tire While The HIGHEST acceptable transfer price is $75 the Tire Division's market price.
Informal groups: Group of answer choices exist primarily for the benefit of their members. perform routine organizational goals. perform uncommon tasks of the organization. always have a high level of interdependence. are initiated by the organization for special purposes.
Answer:
exist primarily for the benefit of their members.
Explanation:
Informal groups in an organization are created when individuals form a bond based on the experience that they share, they appear from friendship and not by rules inside the company but they influence how people interact and how they perform their job. Also, companies promote the apperance of these groups because they help people interact and improve their communication. According to that, the answer is that informal groups exist primarily for the benefit of their members as they are created by the friendship between employees and not by the company.
The other options are not right because informal groups don't perform routine organizational goals or uncommon tasks of the organization, they don't have a high level of interdependence and they are not initiated by the organization for special purposes because they are created by the employees and are not part of the company's structure.
Mountain Ski Corp. was set up to take large risks and is willing to take the greatest risk possible. Lakeway Train Co. is more typical of the average corporation and is risk-averse.
Projects Returns: Expected Value Standard Deviation
A $ 310,000 $ 173,000
B 676,000 413,000
C 163,000 120,000
D 134,000 101,000
a-1. Compute the coefficients of variation. (Round your answers to 3 decimal places.)
a-2. Which of the following four projects should Mountain Ski Corp.
A. Project B
B. Project A
C. Project C
D. Project D
Answer:
B. Project A
Explanation:
Coefficient of variation=standard deviation/expected return value
Project A:
Coefficient of variation=$173,000/$310,000= 0.558
Project B:
Coefficient of variation=$413,000/$676,000= 0.611
Project C:
Coefficient of variation=$120,000/$163,000=0.736
Project D:
Coefficient of variation=$101,000/$134,000=0.754
The Project A has the lowest rate of risk per unit of return, hence, it is the preferred choice of investment
Suppose that in 1969, the U.S. economy was operating close to potential. The budget deficit experienced by the United States in 1969 was:
Answer: primarily cyclical deficit
Explanation:
Budget deficit occurs when the government expenditure for a certain year is more than the revenue the government makes.
Since the the United States economy was operating close to potential. The budget deficit experienced by the United States in 1969 was primarily cyclical deficit.
