Answer:
$2,765,000
Explanation:
Calculation to determine what amount of cost of goods sold did ABC record in 20X8 prior to consolidation
Cost of goods sold= $79 each* 35,000
Cost of goods sold=$2,765,000
Therefore the amount of cost of goods sold that ABC record in 20X8 prior to consolidation is $2,765,000
Using the information given and assuming that ABC Corporation sells the chairs it produces to XYZ Company only, the cost of goods sold is $3,150,000.
Data and Calculations:
Shareholding of ABC Corporation in XYZ = 75%
ABC production units in 20X8 = 50,000 chairs
Number of units sold to XYZ = 35,000 chairs
Cost of product per unit = $90
Thus, if ABC Corporation sells the chairs it produces to XYZ Company only, the cost of goods sold is $3,150,000 ($90 x 35,000).
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Depreciation on equipment for the year is $5,640.
Journalize the transaction if the company prepares adjustments once a year.
(a) Record the journal entry if the company prepares adjustments once a year.*
(b) Record the journal entry if the company prepares adjustments on a monthly basis.*
*Refer to the Chart of Accounts for exact wording of account titles.
Chart of Accounts
CHART OF ACCOUNTS
General Ledger
ASSETS
11 Cash
12 Accounts Receivable
13 Supplies
14 Prepaid Insurance
16 Equipment
17 Accumulated Depreciation-Equipment
LIABILITIES
21 Accounts Payable
22 Notes Payable
23 Unearned Fees
24 Wages Payable
25 Interest Payable
EQUITY
31 Common Stock
32 Retained Earnings
33 Dividends
REVENUE
41 Fees Earned
EXPENSES
51 Advertising Expense
52 Insurance Expense
53 Interest Expense
54 Wages Expense
55 Supplies Expense
56 Utilities Expense
57 Depreciation Expense
59 Miscellaneous Expense
General Journal
(a) Record the journal entry on December 31, if the company prepares adjustments once a year.*
(b) Record the journal entry on December 31, if the company prepares adjustments on a monthly basis.*
*Refer to the Chart of Accounts for exact wording of account titles.
PAGE 1
JOURNAL
DATE DESCRIPTION POST. REF. DEBIT CREDIT
1
2
3
4
Answer:
a.
Date Account Title Debit Credit
XX-XX-XXX Depreciation Expense $5,640
Accumulated Depreciation $5,640
b.
Date Account Title Debit Credit
XX-XX-XXX Depreciation Expense $470
Accumulated Depreciation $470
Working
Monthly depreciation = Annual depreciation / 12 months
= 5,640 / 12
= $470
what are the characteristics of effective communication
Answer:
Clear—main ideas easily identified and understood.
Concise—gets to the point without using unneeded words or images.
Concrete—includes specific examples or explanations.
Correct—in information, word choice, and grammar.
Coherent—information presented in a logical sequence.
Completeness. Effective communications are complete, i.e. the receiver gets all the information he needs to process the message and take action. ...
Conciseness. Conciseness is about keeping your message to a point. ...
Consideration. ...
Concreteness. ...
Courtesy. ...
Clearness. ...
Correctness.
Explanation:
Hope this helps.
The partners share profits and losses in the ratio of 5:3:2, respectively. The partners agreed to dissolve the partnership after selling the other assets for $50,000. On dissolution of the partnership, Janet should receive:
Answer:
$30,000
Explanation:
The computation of the amount received by Janet is given below:
Loss on sale of other assets is
= $150,000 - $50,000
= $100,000
Share of Janet in loss is
= $100,000 × 5 ÷ 10
= $50,000
So,
Janet revised capital balance is
= $80,000 - $50,000
= $30,000
In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis.
Recall the components that make up GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C = consumption, I = investment, G = government purchases, X = exports, M = imports, and NX = net exports:
Y =
Also, national saving is the income of the nation that is left after paying for Therefore, national saving (S) is defined as: S =
Rearranging the previous equation and solving for Y yields Y = . Plugging this into the original equation showing the various components of GDP results in the following relationship:
S =
This is equivalent to S =, since net exports must equal net capital outflow (NCO, also known as net foreign investment).
Now suppose that a country is experiencing a trade surplus. Determine the relationships between the entries in the following table, and enter these relationships using the following symbols: > (greater than), < (less than), or = (equal to).
Answer:
a. Y = C + I + G + NX
b. National saving is the income of the nation that is left after paying for current consumption (C) and government purchases (G).
c. S = Y - C - G
d. Y = S + C + G
e. S = I + NX
f. S = I + NCO
g. Outcomes of a Trade Surplus
Exports > Imports
Net Exports > 0
C + I + G < Y
Saving > Investment
Net Capital Outflow > 0
Explanation:
a. Y = C + I + G + X - M …………………. (1)
If we assumed X is greater than M, we have:
NX = X - M
Substituting NX = X - M into equation (1), we have:
Y = C + I + G + NX
b. Also, national saving is the income of the nation that is left after paying for current consumption (C) and government purchases (G).
c. Therefore, national saving (S) is defined as: S = Y - C - G.
d. Rearranging the previous equation and solving for Y yields Y = S + C + G.
e. Plugging this into the original equation showing the various components of GDP results in the following relationship:
S + C + G = C + I + G + NX
S = C + I + G + NX - C - G
S = I + NX
f. This is equivalent to S = I + NCO, since net exports must equal net capital outflow (NCO, also known as net foreign investment).
g. Now suppose that a country is experiencing a trade surplus. Determine the relationships between the entries in the following table, and enter these relationships using the following symbols: > (greater than), < (less than), or = (equal to).
Note: The omitted table in the question given as follows:
Outcomes of a Trade Surplus
Exports ____ Imports
Net Exports _____ 0
C + I + G _____ Y
Saving ____ Investment
Net Capital Outflow ___ 0
Therefore, the answer is given as follows:
Outcomes of a Trade Surplus
Exports > Imports
Net Exports > 0
C + I + G < Y
Saving > Investment
Net Capital Outflow > 0
Curtain Co. paid dividends of $10,000, $12,500, and $14,000 during Year 1, Year 2, and Year 3, respectively. The company had 2,100 shares of 5.5%, $100 par value preferred stock outstanding that paid a cumulative dividend. What is the total amount of dividends paid to common shareholders during Year 3?
A. $4800.B. $1000.C. $2600.D. $800.
Answer:
Total amound paid to shareholder in 3rd year = $1850
Explanation:
Below is the calculation:
Total dividend paid = 1st year divident + 2nd year divident + 3rd year dividend
Total dividend paid = $10000 + 12500 + 14000
Total dividend paid = $36500
Total preferred dividend = (2100 x 100) x 5.5% x 3
Total preferred dividend = $34650
Total amount of dividend paid to shareholder during 3rd year = 36500 - 34650 = $1850
Total amound paid to shareholder in 3rd year = $1850
A corporate bond with a 6% coupon (paid semiannually) has a yield to maturity of 7.5%. The bond matures in 20 years but is callable at $1050 in ten years. The maturity value is par. Calculate the bond’s yield to call. % terms w/o $ sign. (HINT: Find the current price and then solve for YTC.)
Answer:
Yield to Call = 8.66%
Explanation:
The computation of the yield to call is shown below:
First determine Current Price of Bond,
PV = [FV = 1,000, PMT = 30, N = 40, I = 0.075 ÷2]
PV = $845.87
Callable Price = $1,050
Now
Calculating Yield to Call,
I = [PV = -845.87, FV = 1,050, N = 20, PMT = 30]
I = 8.66%
Yield to Call = 8.66%
The following account balances are taken from the December 31, 2018, financial statements of ABZ Advertising Company. The company uses accrual basis accounting.
Advertising Revenue $46,982
Cash 41,516
Accounts Receivable 7,296
Interest Expense 2,299
Accounts Payable 5,000
Operating Expenses 37,460
Deferred Revenue 1178
Equipment 18,648
Income Tax Expense 2,326
The following activities occurred in 2019:
1. Performed advertising services on account, $55,000.
2. Received cash payments from customers on account, $10,400.
3. Received deposits from customers for advertising services to be performed in 2020, $2,500.
4. Made payments to suppliers on account, $7,000.
5. Incurred $45,000 of operating expenses; $39,000 was paid in cash and $6,000 was on account and unpaid as of the end of the year.
Required:
What is the amount of revenue that will be reported on the income statement for the year ended December 31, 2019?
Answer:
the amount of the revenue that should be recorded is $51,896
Explanation:
The computation of the amount of the revenue that should be recorded is shown below:
= Opening balance of account receivable + service revenue balance on the account - cash payment
= $7,296 + $55,000 - $10,400
= $51,896
Hence, the amount of the revenue that should be recorded is $51,896
The costs of bringing a corporation into existence, including legal fees and promoter fees, are called:
Answer:
organization expenses.
Explanation:
A corporation can be defined as a corporate organization that has facilities and owns or controls assets used for the production of goods and services in at least one country other than its headquarter (home office) located in its home country.
This ultimately implies that, a corporation is a corporate organization that owns or controls its business in two or more countries.
Some examples of multinational firms are Ap-ple, Volkswagen, G-oogle, Shoprite, Nestlé, Accenture, Shell BP, Chevron etc.
The costs of bringing a corporation into existence, including legal fees and promoter fees, are called organization expenses.
A short futures contract on a non-dividend paying stock was entered some time ago. It now has 6 months to maturity. The risk-free rate of interest is 10% per year. The stock is currently trading at $25/share and the delivery price is $24/share. How much is your position worth today (ignore marking to market costs)
Answer:
$26.225
Explanation:
Spot rate amount = $25
Period = 0
FV Period = 6 month. FVF at 5%, 6 month = 1.049
Position worth today = Spot rate amount * FVF
Position worth today = $25 * 1.049
Position worth today = $26.225
So, my position worth today is $26.225.
If the efficient market hypothesis is true, price changes are independent and biased. Group of answer choices
Answer:
Price changes are independent but not biased in efficient market hypothesis.
Explanation:
In simple words, the efficient-market hypothesis asserts that asset prices represent all relevant knowledge. Because market rates must only respond to fresh knowledge it is difficult to continuously "beat the market" on something like a risk-adjusted approach.
Thus the given statement is partially true.
julie has just retired. Her company’s retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $127,000 immediately as her full retirement benefit. Under the second option, she would receive $14,000 each year for 10 years plus a lump-sum payment of $53,000 at the end of the 10-year period. Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables. Required: 1-a. Calculate the present value for the following assuming that the money can be invested at 11%. 1-b. If she can invest money at 11%, which option would you recommend that she accept
Answer:
a. i. Present value of first option = $127,000
ii. Present value of second option:
= Present value of $14,000 annuity + Present value of $53,000 lump sum.
Present value of annuity:
= Annuity * Present value interest factor of annuity, 11%, 10 years
= 14,000 * 5.8892
= $82,448.80
Present value of lump sum:
= 53,000 / ( 1 + 11%)¹⁰
= $18,665.77
Present value of second option = 82,448.80 + 18,665.77
= $101,114.57
b. She should take the first option. It has a larger present value.
CompuTop Company sells toy laptop computers for $30 each. If the variable cost for each laptop is $20 and fixed costs total $25,000, how much sales in dollars must it sell to generate a target income of $66,667
Answer:
the sales in dollars sell to generate the target income is $183,334
Explanation:
The computation of the sales in dollars sell to generate the target income is shown below:
= (Fixed cost + target income) ÷ (selling price - variable cost) ÷ selling price
= ($25,000 + $66,667) ÷ ($30 - $20) ÷ $20
= $91,667 ÷ 50%
= $183,334
Hence, the sales in dollars sell to generate the target income is $183,334
The following data relates to Black-Out Company's estimated amounts for next year. Estimated: Department 1 Department 2 Manufacturing overhead costs $ 300,000 $ 400,000 Direct labor hours 60,000 DLH 80,000 DLH Machine hours 1,000 MH 2,000 MH What is the company's plantwide overhead rate if machine hours are the allocation base
Answer:
Predetermined manufacturing overhead rate= $233.33 per machine hour
Explanation:
Giving the following information:
Total estimated overhead= 300,000 + 400,000= $700,000
Machine hours= 1,000 + 2,000= 3,000
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 700,000 / 3,000
Predetermined manufacturing overhead rate= $233.33 per machine hour
The discount rate that makes the present value of a bond's payments equal to its price is termed the:
Coupon rate is the rate of discount that makes the present value of a bond's payments equal to its price.
Basically, the discount rate means the interest rate used to get P.V. of future cash flows in a discounted cash flow (DCF).
The coupon rate refers to the interest rate paid by bond-issuers on the bond's face value.
Hence, the Coupon rate is the rate of discount that makes the present value of a bond's payments equal to its price.
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Jack asked Jill to marry him, and she has accepted under one condition: Jack must buy her a new $ Rolls-Royce Phantom. Jack currently has $ that he may invest. He has found a mutual fund with an expected annual return of % in which he will place the money. How long will it take Jack to win Jill's hand in marriage?
Answer: 47.8 years
Explanation:
Jack is trying to make up to $330,000 from $50,680 at a rate of 4%.
The relevant formula is the future value formula as Jack is trying to get to a certain amount in future:
330,000 = 50,680 * ( 1 + 4%) ^ number of years
1.04 ^ number of years = 330,000 / 50,680
1.04 ^ N = 6.51144435674822
Use the natural logarithm:
N * In (1.04) = In (6.51144435674822)
N * 0.039220713153281 = 1.873561299007586979
N = 1.873561299007586979 / 0.039220713153281
= 47.8 years
7. During January 2005, an Italian invested in the Italian stock market and earned a return of 1.47%. During the same month, an American investor investing in the Italian stock market earned a return of –2.358%.
Answer:
Escreva a expressão algébrica correspondente a cada sentença abaixo descrita.
a) O quadrado de um número real x.
b) O cubo de um número real y.
c) O triplo de um número adicionado ao dobro de um número k.
d) A terça parte de um número real diminuído 7.
Explanation:
Escreva a expressão algébrica correspondente a cada sentença abaixo descrita.
a) O quadrado de um número real x.
b) O cubo de um número real y.
c) O triplo de um número adicionado ao dobro de um número k.
d) A terça parte de um número real diminuído 7.
If average household income increases by 20%, from $50,000 to $60,000 per year, the quantity of rooms demanded at the Triple Sevens from rooms per night to rooms per night. Therefore, the income elasticity of demand is , meaning that hotel rooms at the Triple Sevens are
Answer:
Therefore, the income elasticity of demand is 0.83, meaning that hotel rooms at the Triple Sevens are normal goods and necessities.
Explanation:
Note: This question is not complete as some data in it are missing. The complete question is therefore provided before answering the question as follows:
If average household income increases by 20%, from $50,000 to $60,000 per year, the quantity of rooms demanded at the Triple Sevens rises from 300 rooms per night to 350 rooms per night. Therefore, the income elasticity of demand is __________, meaning that hotel rooms at the Triple Sevens are__________.
The explanation of the answer is now provided as follows:
Percentage change in income = 20%
Percentage change in quantity of rooms demanded = ((350 - 300) / 300) * 100 = 16.67%
Income elasticity of demand = Percentage change in quantity of rooms demanded / Percentage change in income = 16.67% / 20% = 0.83
Since the income elasticity of demand is positive but less than one, this implies that hotel rooms at the Triple Sevens are normal goods and necessities.
Therefore, the income elasticity of demand is 0.83, meaning that hotel rooms at the Triple Sevens are normal goods and necessities.
Which of the following is part of the generally accepted account of the 1822 conspiracy led by Denmark Vesey?A. His lieutenant was named Cinque. B. Vesey and his followers killed or maimed 37 whites. C. Vesey studied the Magna Carta and quoted the Farmer's Almanac.D. Vesey had purchased his freedom after winning the lottery.
Answer: D. Vesey had purchased his freedom after winning the lottery.
Explanation:
Denmark Vasey was a African American leader in the early 19th century who was born into slavery but was able to buy his freedom when he won a lottery.
In 1822, he was accused of a conspiracy to organize a slavery revolt that would have seen thousands of African Americans killing slave owners in South Carolina and then sailing to Haiti. They had him executed at the age of 55 for this alleged crime.
High-Low Method, Cost Formulas The controller of the South Charleston plant of Ravinia, Inc., monitored activities associated with materials handling costs. The high and low levels of resource usage occurred in September and March for three different resources associated with materials handling. The number of moves is the driver. The total costs of the three resources and the activity output, as measured by moves for the two different levels, are presented as follows: Resource Number of Moves Total Cost Forklift depreciation: Low 5,000 $1,600 High 15,000 1,600 Indirect labor: Low 5,000 $74,000 High 15,000 136,000 Fuel and oil for forklift: Low 5,000 $3,550 High 15,000 10,650 Required: If required, round your answers to two decimal places. Enter a "0" if required. 1. Determine the cost behavior formula of each resource. Use the high-low method to assess the fixed and variable components. Forklift depreciation: V $ F $ Y $ Indirect labor: V $ F $ Y $ + $ X Fuel and oil for forklift: V $ F $ Y $ X 2. Using your knowledge of cost behavior, predict the cost of each item for an activity output level of 8,000 moves. Forklift depreciation $ Indirect labor $ Fuel and oil for forklift $ 3. Construct a cost formula that can be used to predict the total cost of the three resources combined. If required, round your answers to two decimal places. Materials handling cost = $ + $ X Using this formula, predict the total materials handling cost if activity output is 8,000 moves. Y = $.
Answer:
South Charleston Plant of Ravinia, Inc.
1. Cost behavior formula:
Forklift depreciation = $1,600 + $0q
Indirect labor = $43,000 + $6.20q
Fuel and oil for forklift = $3,550 + $0.71 (q - 5,000)
2. Cost of each item for an activity output level of 8,000 moves:
Forklift depreciation = $1,600
Indirect labor = $92,600
Fuel and oil for forklift = $5,680
3. Total cost formula = $48,150 + $6.47q
Materials handling cost = $99,880
Explanation:
a) Data and Calculations:
Resource Number of Moves Total Cost
Forklift depreciation:
Low 5,000 $1,600
High 15,000 1,600
Indirect labor:
Low 5,000 $74,000
High 15,000 136,000
Fuel and oil for forklift:
Low 5,000 $3,550
High 15,000 10,650
Cost behavior formula for each resource:
Forklift depreciation:
Low 5,000 $1,600
High 15,000 1,600
Difference 10,000 $0
Variable cost per unit = $0 ($0/10,000)
Fixed cost = $1,600
Cost behavior formula = $1,600 + $0q
Indirect labor:
Low 5,000 $74,000
High 15,000 136,000
Difference 10,000 62,000
Variable cost per unit = $6.20 ($62,000/10,000)
Fixed cost = $43,000 ($74,000 - ($6.20*5,000))
Cost behavior formula = $43,000 + $6.20q
Fuel and oil for forklift:
Low 5,000 $3,550
High 15,000 10,650
Difference 10,000 $7,100
Variable cost per unit = $0.71 ($7,100/10,000)
Fixed cost = $3,550 ($3,0 - ($0.71 * (15,000 - 5,000))
Step cost
Cost behavior formula = $3,550 + $0.71 (q - 5,000)
Forklift depreciation = $1,600 + $0 * 8,000 = $1,600
Indirect labor = $43,000 + $6.20 * 8,000 = $92,600
Fuel and oil for forklift = $3,550 + $0.71 (8,000 - 5,000) = $5,680
Total cost formula: Fixed + Variable
Forklift depreciation = $1,600 + $0 * 8,000 = $1,600
Indirect labor = $43,000 + $6.20 * 8,000 = $92,600
Fuel and oil for forklift = $3,550 + $0.71 (8,000 - 5,000) = $5,680
$48,150 + $51,730 = $99,880
= $48,150 + $6.47q ($51,730/8,000)
Materials handling cost = ($1600 + $43000) + ($6.20 + $0.71) X
= $44600 + $6.91 X
Y = $44600 + ($6.91 x 8000)
= $44600 + $55280
= $99880
Which Company/Security report would be best for someone looking to compare a company to its peers in a single display
Which Company/Security report would be best for someone looking to compare a company to its peers in a single display is Comps.
In short, locating comps involves searching out current income of homes as similar to your very own belongings as viable, then evaluating your own home to them and adjusting your rate to account for the differences.
Comparable (comps) are utilized in valuations in which a currently offered asset is used to decide the price of a comparable asset. Comparable, regularly utilized in actual property to discover the honest price of a domestic, are a listing of latest asset income that replicate the traits of the asset and proprietor is seeking to promote.
Simply put, actual property comparable – or “comps” – are similar houses in a selected place that you are looking to shop for or promote in. Comps are used to decide the price of a domestic through evaluating it to comparable houses offered withinside the equal community or in a place as near as viable to the residence being valued.
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what is balance of trade and balance of payment?
Answer:
the difference in value between a country's imports and exports.
is an accounting of a country's international transactions for a particular time period.
The three categories of manufacturing costs comprising the cost of work in process are direct labor, direct materials, and: __________
a) direct expenses
b) indirect expenses
c) factory overhead
d) sales salaries expense
Answer:
C)) factory overhead
Explanation:
Manufacturing cost can be regarded as the sum of all the costs resources that is been consumed during the process of making a product. manufacturing cost can be classified as;
✓direct materials cost
✓ manufacturing overhead.
✓direct labor cost
It can be regarded as factor in total delivery cost. Direct Material Cost can be regarded as total cost that is incurred in purchasing of raw material and cost of other components such as packaging, as well as freight and storage costs by the company
It should be noted that The three categories of manufacturing costs comprising the cost of work in process are direct labor, direct materials, and factory overhead.
If IBM has a beta of 1.2 when the risk-free rate is 6% and the expected return on the market portfolio is 18%, the expected return on IBM is:
Answer:
20.4%
Explanation:
Calculation to determine what the expected return on IBM is:
Using this formula
E(Ribm)=Risk-free rate+(Market portfolio -Risk-free rate) Beta
Let plug in the formula
E(Ribm) = 6% +(18%-6%)1.2
E(Ribm)=6%+12%(1.2)
E(Ribm)=6%+14.4%
E(Ribm)=20.4%
Therefore the expected return on IBM is:20.4%
The number of all credit-card holders in the U.S. is IN(a) million card holders and the collective amount of credit card debt that all credit-card holders carry is D(x) billion dollars, x years after 2010. The average credit card debt per card holder at year x is:
Answer: D(x) / IN(a)
Explanation:
If one wanted to find out the average credit card debt per card holder then the correct formula would be:
= Amount of debt that all credit card holders carry / Number of credit card holders
As the amount of debt that all credit card holders carry is denoted by D(x) and the number of credit card holders is IN(a), the average credit card debt per card holder is:
= D(x) / IN(a)
Refer to the following information about the Finishing Department in the Gallagher Factory for the month of June. Gallagher Factory uses the FIFO method of inventory costing.
Beginning Work in Process inventory:
Physical units..... 5000
% complete for materials 70%
% complete for conversion costs 25%
Materials cost from May 7350
Conversion costs from May 3125
Product started:
Physical units 44000
Ending Work in Process inventory:
Physical units 4000
% complete for materials 40%
% complete for conversion costs 10%
Manufacturing costs for June:
Materials 96975
Conversion costs 79470
Compute equivalent units for direct materials for June.
Answer:
the equivalent units for direct material is 43,100 units
Explanation:
The computation of the equivalent units for direct material is shown below:
= Ending work in process units + units started and completed + opening work in process units
= 40% of 4,000 units + (44,000 - 4,000) + 30% of 5,000
= 1,600 units + 40,000 units + 1,500 units
= 43,100 units
hence, the equivalent units for direct material is 43,100 units
Stocks have a 12% expected return and 22% risk. Bonds have a 7% expected return and 10% risk. The expected return of a portfolio comprised of 70% stocks and 30% bonds is: Group of answer choices
Answer:
10.5%
Explanation:
Calculation to determine Expected return of portfolio
Using this formula
Expected return of portfolio = Ws*E(rs) + Wb*E(rb)
Where,
Expected return stock E(rs) = 12%
Expected return bond E(rb) = 7%
Weight of stock Ws = 0.70
Weight of bond Wb = 0.30
Let plug in the formula
Expected return of portfolio= 0.7*12 + 0.3*7
Expected return of portfolio = 10.5%
Therefore Expected return of portfolio is 10.5%
Schneider Inc. had salaries payable of $61,400 and $90,700 at the end of Year 1 and Year 2, respectively. During Year 2, Schneider recorded $620,000 in salaries expense in its income statement. Cash outflows for salaries in Year 2 were:
Answer:
$590,700
Explanation:
We can determine the amount of Cash outflows for salaries in Year 2 by preparing a Salaries Payable T - Account.
Salaries Payable T - Account.
Debit
Ending Balance $90,700
Cash (Balancing figure) $590,700
Total $681,400
Credit
Beginning Balance $61,400
Income Statement $620,000
Total $681,400
thus,
Cash outflows for salaries in Year 2 were $590,700.
The 10% bonds payable of Kim Company had a net carrying amount (carrying value) of $2,850,000 on July 2, 2021. The bonds, which had a face value of $3,000,000, were issued at a discount to yield 12%. The amortization of the bond discount was recorded under the effective-interest method. Interest was paid on January 1 and July 1 of each year. On July 2, 2021, several years before their maturity, Kim retired the bonds at 101. The interest payment on July 1, 2021 was made as scheduled. What is the loss that Kim should record on the early retirement of the bonds on July 2, 2021
Answer:
-$159,000
Explanation:
Calculation to determine the loss that Kim should record on the early retirement of the bonds on July 2, 2021
First step is to calculate the CV of bonds
CV of bonds =$2,850,000 + [($2,850,000 × 12%/2) – ($3,000,000 × 10%/2)]
CV of bonds =$2,850,000 + [($2,850,000 × .06) – ($3,000,000 × .05)]
CV of bonds =$2,850,000 +($171,000-$150,000)
CV of bonds =$2,850,000 +$21,000
CV of bonds =$2,871,000
Now let determine the Loss
Loss=$2,871,000 – ($3,000,000 × 1.01)
Loss=$2,871,000 – $3,030,000
Loss= -$159,000
Therefore the loss that Kim should record on the early retirement of the bonds on July 2, 2021 is $159,000
Walters manufactures a specialty food product that can currently be sold for $21.50 per unit and has 19,500 units on hand. Alternatively, it can be further processed at a cost of $11,500 and converted into 11,500 units of Deluxe and 5,500 units of Super. The selling price of Deluxe and Super are $31.50 and $19.50, respectively. The incremental net income of processing further would be:
Answer:
the incremental net income of processing further is $38,750
Explanation:
The computation of the incremental net income of processing further is given below:
= (11,500 units × $31.50 + 5,500 units × $19.50 - $11,500) - ($19,500 × $21.50)
= ($362,250 + $107,250 - $11,500) - $419,250
= $38,750
Hence, the incremental net income of processing further is $38,750
What is Company XYZ's intrinsic equity value using the WACC as the discount rate and assuming the terminal value is based on the EBITDA exit multiple
Answer:
$315,198
Explanation:
WACC = [ Equity / Total value ] * cost of equity + [ Debt / Total value ] * Cost of debt.
WACC = 11.5%
Exit multiple = Total cash outflow / Total cash inflow
Exit multiple = $120,000 / 36,000 = 3.3x
EBITDA of the company is $178,412.
