Answer:
scenario analysis
Explanation:
scenario analysis estimates changes that would result from a hypothetical change in the market or a reoccurrence of an historical event.
types of scenario analysis
1. historical scenarios : scenarios measure an hypothetical change that would result from a repeat of a particular period of financial history.
2. Hypothetical scenarios : scenarios have never occurred and are just conjured for the sake of analysis.
Sensitivity measures the impact of the change of one variable.
What is the Production Possibilities Frontier's purpose?
:a. Showing businesses that in order to produce more, they need to hire more output
b. Show businesses that businesses should not produce at their maximum capacity because they could exhaust their workers and capital goods
c. Show businesses that they need to produce at their maximum capacity to be efficient
d. Showing businesses that a worker's high morale is necessary to make them efficient
Answer:
Uhh b
Explanation:
The following information pertains to Cullumber Company. 1. Cash balance per bank, July 31, $11,310. 2. July bank service charge not recorded by the depositor $65. 3. Cash balance per books, July 31, $11,440. 4. Deposits in transit, July 31, $4,615. 5. $2,600 collected for Cullumber Company in July by the bank through electronic funds transfer. The accounts receivable collection has not been recorded by Cullumber Company. 6. Outstanding checks, July 31, $1,950. (a) Prepare a bank reconciliation at July 31, 2022.
Answer:
See below
Explanation:
Cullumber Company
Bank Reconciliation
July 31, 2022
Cash balance as per bank
$11,310
Add:
Deposits in transit
$4,615
Less:
Outstanding checks
($1,950)
Adjusted bank balance
$13,975
Cash balance per books
$11,440
Add:
Electronic fund transfer received
$2,600
Less:
Bank service charges
($65)
Adjusted cash balance
$13,975
You own a portfolio that has $2,600 invested in Stock A and $3,600 invested in Stock B. If the expected returns on these stocks are 12 percent and 15 percent, respectively, what is the expected return on the portfolio
Answer:
the expected return on the portfolio is $7,052
Explanation:
The computation of the expected return on the portfolio is shown below:
Stock A return = $2,600 + 12% of 2600 = $2,912
And,
Stock B return = $3,600 + 15% of 3600 = $4,140
So,
Expected return on portfolio is
= $2,912 + $4,140
= $7,052
hence, the expected return on the portfolio is $7,052
Zhang Industries sells a product for $700 per unit. Unit sales for May were 400, and each month's unit sales are expected to grow by 3%. Zhang pays a sales manager a monthly salary of $3,000 and a commission of 2% of sales. Compute the budgeted selling expense for the manager for the month ended June 30.
Answer:
Zhang Industries
The Budgeted selling expense for the manger for the month ended June 30 is:
= $8,768.
Explanation:
a) Data and Calculations:
Selling price per unit = $700
Unit sales for May = 400
Expected growth of unit sales each month = 3%
Unit sales for June = 412 (400 * 1.03)
Sales revenue for June = $288,400 ($700 * 412)
Monthly sales salary to the sales manager = $3,000
Monthly sales commission = 2% of sales
Budgeted selling expense for the manger for the month ended June 30:
Monthly sales salary to the sales manager = $3,000
Monthly sales commission = 2% of sales 5,768 ($288,400 * 2%)
Total selling expense for the month = $8,768
During the past year, Sweeter than Honey Inc. sold 920 beehives. Inventory records for the year are as follows: DATE QUANTITY COST TOTAL January 1 Beginning Inventory 180 $38 $ 6,840 January 30 Purchase 300 32 9,600 March 16 Purchase 150 12 1,800 November 10 Purchase 420 15 6,300 December 14 Purchase 400 43 17,200 Total available for sale 1,450 $41,740 Using the average cost method of inventory pricing, calculate the dollar value of the ending inventory. (Round your answer to 2 decimal places) Group of answer choices $19,128.00 $28,772.00 $15,258.70 $22,541.80
Suppose the annual inflation rate in the US is expected to be 2.5 %, while it is expected to be 18.00 % in Mexico. The current spot rate (on 1/1/X0) for the Mexican Peso (MXN) is $0.1000. If the spot rate of MXN turns out to be $0.085 on 1/1/X1, the net cash flow of a US importer from Mexico will: Group of answer choices Increase Decrease
Answer:
Increase
Explanation:
In putting the question into a better perspective let us assume that the US importer buys goods from Mexico every year to the Tune of 1,000,000 Mexican Pesos.
The expected exchange rate on 1/1/X1=$0.1000*(1+2.5%)/(1+18%)
The expected exchange rate on 1/1/X1=$0.086864407
Amount paid based on expected exchange rate=1,000,000*$0.086864407
Amount paid based on expected exchange rate=$86,864.41
Amount paid based on actual exchange=1,000,000*$0.085
Amount paid based on actual exchange=$85,000
The above means that the US importer paid a lesser amount($85000) than it should have paid, hence, its net cash flow would increase due to a reduction in payment
SWH Corporation issued bonds on January 1, 2004. The bonds had a coupon rate of 5.5%, with interest paid semiannually. The face value of the bonds is $1,000 and the bonds mature on January 1, 2019. What is the yield to maturity for an SWH Corporation bond on January 1, 2010 if the market price of the bond on that date is $950
Answer:
6.23%
Explanation:
From Jan 2019 to Jan 2010 = 9 years
N = 9 years*2 = 18
PV = $950
Coupon payment = $27.5 (1000*5.5%/2)
FV = $1000
We need to solve for YTM using the MsExcel function
Yield to maturity = YTM(n, pv, pmt, fv) * 2
Yield to maturity = YTM(18, 950, 27.5, 1000) * 2
Yield to maturity = 0.03117 * 2
Yield to maturity = 0.06234
Yield to maturity = 6.23%
During 2015, a construction company changed from the completed-contract method to the percentage-of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below:
Completed-Contract Percentage-of-Completion
2013 $ 475,000 $ 900,000
2014 625,000 950,000
2015 700,000 1,050,000
$1,800,000 $2,900,000
Assuming an income tax rate of 40% for all years, the affect of this accounting change on prior periods should be reported by a credit of:____________
Answer:
$450,000
Explanation:
Calculation to determine , the affect of this accounting change on prior periods that should be reported by a credit of:
Using this formula
Accounting change on prior periods=(2013 Percentage-of-Completion+2014 Percentage-of-Completion)-(2013 Completed-Contract+2014 Completed-Contract)*(1-Tax rate)
Let plug in the formula
Accounting change on prior periods=[($900,000+$950,000)-($475,000+$625,000)]*(1-40%)
Accounting change on prior periods=($1,850,000-$1,100,000)*0.60
Accounting change on prior periods=$750,000*.60
Accounting change on prior periods=$450,000
Therefore Assuming an income tax rate of 40% for all years, the affect of this accounting change on prior periods should be reported by a credit of:$450,000
Andrews Co. can purchase 20,000 units of Part XYZ from a supplier for $18 per part. Andrews' per unit manufacturing costs for 20,000 units is as follows: Cost Per Unit Total Variable manufacturing cost $12 $240,000 Supervisor salary $3 $60,000 Depreciation $1 $20,000 Allocated fixed overhead $7 $140,000 If the part is purchased, the supervisor position will be eliminated. The special equipment has no other use and no salvage value. Total allocated fixed overhead would be unaffected by the decision. The company should ______.
Answer:
Andrews Co.
The company should ______.
should make the part.
Explanation:
a) Data and Calculations:
Costs to make Part XYZ:
Cost Per Unit Total
Variable manufacturing cost $12 $240,000
Supervisor salary $3 $60,000
Depreciation $1 $20,000
Allocated fixed overhead $7 $140,000
Units to be made or bought = 20,000 units
Cost to buy Part XYZ = $18 per part.
Relevant costs:
Make Buy Difference
Variable manufacturing cost $12
Supervisor salary $3
Total relevant cost per unit $15 $18 $3
Total costs $300,000 $360,000 $60,000
b) There is a cost-saving of $60,000 when Part XYZ is made internally. The cost of depreciation is not relevant in the decision since the equipment has no salvage value or any other use. Similarly, the fixed overhead will still be incurred, no matter the alternative chosen by the company.
Gabi Gram started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first month of operations
May
1 G. Gram invested $40,000 cash in the company.
1 The company rented a furnished office and paid $2,200 cash for May’s rent.
3 The company purchased $1,890 of office equipment on credit.
5 The company paid $750 cash for this month’s cleaning services.
8 The company provided consulting services for a client and immediately collected $5,400 cash.
12 The company provided $2,500 of consulting services for a client on credit.
15 The company paid $750 cash for an assistant’s salary for the first half of this month.
20 The company received $2,500 cash payment for the services provided on May 12.
22 The company provided $3,200 of consulting services on credit.
25 The company received $3,200 cash payment for the services provided on May 22.
26 The company paid $1,890 cash for the office equipment purchased on May 3.
27 The company purchased $80 of advertising in this month’s (May) local paper on credit; cash payment is due June 1.
28 The company paid $750 cash for an assistant’s salary for the second half of this month.
30 The company paid $300 cash for this month’s telephone bill.
30 The company paid $280 cash for this month’s utilities.
31 G. Gram withdrew $1,400 cash from the company for personal use.
Required
a. Show effects of the transactions on the accounts of the accounting equation by recording increases and decreases in the appropriate columns.
b. Prepare an income statement for May, a statement of owner’s equity for May, a May 31 balance sheet, and a statement of cash flows for May.
Answer:
1. Asset and capital will increase
2. Current asset decrease
3. Asset and liability increase
4. Asset decrease
5. Asset increase
6. Asset increase
7. Asset decrease, expense increase
8. Asset increase
9. Asset increase
10. Asset decrease, liability decrease
11. Liability increased
12. Asset decrease
13. Asset decrease
14. Capital decrease
Explanation:
Income Statement for the month of May:
Sales Revenue $11,100
Less: Operating Expenses:
Cleaning service $750
Salary expense $750
Advertising expense $80
Salaries expense $750
Telephone bill $300
Utilities expense $280
Net Profit $8,190
A researcher wants to test the order of integration of some time series data. He decides to use the DF test. He estimates a regression of the form
delta yt = mu + si yt-1 + mut
and obtains the estimate ˆ? = -0.02 with standard error = 0.31.
(a) What are the null and alternative hypotheses for this test?
(b) Given the data, and a critical value of -2.88, perform the test.
(c) What is the conclusion from this test and what should be the next step?
(d) Why is it not valid to compare the estimated test statistic with the corresponding critical value from a t-distribution, even though the test statistic takes the form of the usual t-ratio?
Answer:
a) H0: u = presence of a unit root
HA: u ≠ presence of a unit root ( i.e. stationary series )
b) t stat = -0.064
c) We will reject the Null hypothesis and the next step will be to accept the alternative hypothesis
d) It is not valid to compare the estimated t stat with the corresponding critical value because a random walk is non-stationary while the difference is stationary because it is white noise
Explanation:
a) stating the null and alternative hypothesis
H0: u = presence of a unit root
HA: u ≠ presence of a unit root ( i.e. stationary series )
b) performing the test
critical value = -2.88
T stat = coefficient / std error
= -0.02 / 0.31 = -0.064
c) From the test, the value of T stat > critical value we will reject the Null hypothesis hence the next step will be to accept the alternative hypothesis
d) It is not valid to compare the estimated t stat with the corresponding critical value because a random walk is non-stationary while the difference is stationary because it is white noise
Dozier Company produced and sold 1,000 units during its first month of operations. It reported the following costs and expenses for the month: Direct materials $ 79,000 Direct labor $ 40,000 Variable manufacturing overhead $ 19,000 Fixed manufacturing overhead 31,000 Total manufacturing overhead $ 50,000 Variable selling expense $ 14,000 Fixed selling expense 22,000 Total selling expense $ 36,000 Variable administrative expense $ 5,000 Fixed administrative expense 27,000 Total administrative expense $ 32,000 Required: 1. With respect to cost classifications for preparing financial statements: a. What is the total product cost
Answer:
Total product cost= $169,000
Explanation:
The product cost is calculated using the direct material, direct labor, and manufacturing overhead:
Direct materials $ 79,000
Direct labor $ 40,000
Variable manufacturing overhead $ 19,000
Fixed manufacturing overhead 31,000
Total product cost= $169,000
Consider the role of management accounting in relation to the company for which you work or have worked
Answer:
The management of accounting, or accounting management is one of the main areas inside any business, because accounting is an essential part of any business since it is in charge of the recording of all the economic transactions that the business engages in.
Accouting information is also vital because it serves as a source for other areas of a business, for example, the financial department because it uses aggregate accounting information, or even the marketing department, because it looks at accounting information in order to determine commercial needs, or to understand what resources are available for carrying out marketing activities.
If a coupon bond has two years to maturity, a coupon rate of 10 %, a par value of $1000 , and a yield to maturity of 12 %, then the coupon bond will sell for $nothing . (Round your response to the nearest two decimal place) The price of a bond and its yield to maturity are ▼ positively related negatively related unrelated .
Answer:
The right solution is "$966.27".
Explanation:
Given values are:
Coupon rate,
= 10%
Par value,
= $1000
Yield of maturity,
= 12%
then,
Coupon will be:
= [tex]1000\times 10 \ percent[/tex]
= [tex]1000\times 0.1[/tex]
= [tex]100[/tex] ($)
Now,
The present value of coupon will be:
= [tex]A\times \frac{(1-(1+r)^n)}{r}[/tex]
By putting the value, we get
= [tex]100\times \frac{1-(1.12)^{-2}}{0.12}[/tex]
= [tex]100\times \frac{1-0.7971}{0.12}[/tex]
= [tex]100\times \frac{0.2029}{0.12}[/tex]
= [tex]169.08[/tex] ($)
The present value of par value will be:
= [tex]\frac{1000}{(1+12 \ percent)^2}[/tex]
= [tex]\frac{1000}{(1.12)^2}[/tex]
= [tex]797.19[/tex] ($)
hence,
The price of bond will be:
= [tex]Present \ value \ of \ coupon+Present \ value \ of \ par \ value[/tex]
= [tex]169.08+797.19[/tex]
= [tex]966.27[/tex] ($)
Suppose that 45% of all babies born in a particular hospital are girls. If 7 babies born in the hospital are randomly selected, what is the probability that at most of them are girls?
Answer:
0.10
Explanation:
Using the binomial probability formula: P(X = x) = (nCx) * p^x * (1 - p)^(n-x)
P(X≤1) = P(X = 0) + P(X = 1)
P(X≤1) = (7C0) * 0.45^0 * (0.55)^7 + (7C1) * 0.45^1 * (0.55)^6
P(X≤1) = 0.1024
P(X≤1) = 0.10
So, the Probability that at most one of them are girls 0.10.
Type your answer in the box.
For a population with u = 25 and = 5, we would expect 90% of all x's calculated from n = 35 to
fall between
and
(Round to two decimals.)
Do you know the answer?
D Read about this
I know it
Think so
Unsure
No idea
Answer:
Your answer is given below:
Explanation:
what is least likely to get managers to act in best interest of the owner threat of a prozy fight stock option plans
Answer:
The least likely to get managers to act in the best interest of the owner is:
stock option plans.
Explanation:
But with the threat of a proxy fight, managers get up to speed, acting in the best interest of the owners of the firm because their jobs are at stake. The main purpose of a proxy fight is the removal of the current management of the firm. During a proxy fight, contest, or battle, some shareholders in a company attempt to oppose and vote out the current management or board of directors. On the other hand, stock option plans reward managers with employee ownership rights at discounted prices.
Turner Enterprises is analyzing a project that is expected to have annual cash flows of $77,400, $21,300 and -$6,200 for Years 1 to 3, respectively. The initial cash outlay is $84,900 and the discount rate is 11 percent. What is the modified IRR
Answer:
8.26%
Explanation:
Calculation to determine the modified IRR
First step is to calculate the Modified Year 2 cash flow
Modified Year 2 cash flow = $21,300 + (-$6,200)/1.11
Modified Year 2 cash flow= $15,714.41
Now let determine the Modified IRR
Modified IRR:$0 = -$84,900 + $77,400/(1 + IRR) + $15,714.41/(1+ IRR)^2
Modified IRR= 8.26%
Therefore the modified IRR is 8.26%
After Jim has gotten two different quotes for repairing his brakes, one from the dealership and one from a small, private mechanic, he choses to go with the small mechanic who has agreed to do his brakes for $200.00 less than the dealership. Jim takes his car to the mechanic who begins working on his brakes. After a week passes, the mechanic calls him and tells him he is in over his head and cannot fix his brakes. Jim goes over to pick up his car and finds his car in the mechanic's garage with the brakes disassembled around the mechanic's garage. What legal recourse does Jim have?
Answer:
Primary estoppel
Explanation:
Primary estoppel is defined as the principle that a promise made by a promisor is enforceable most especially when a promisee believes the promise and this leads to a subsequent detriment.
In the given scenario Jim used a small mechanic to repair his brakes and was assured he could do the job.
However the mechanic calls him and tells him he is in over his head and cannot fix his brakes, and finds his car in the mechanic's garage with the brakes disassembled around the mechanic's garage.
He can resort to primary estoppel as a legal recourse.
Leander Mfg. has three support departments (human resources, administration, and maintenance) and two revenue-generating departments (assembly and finishing). The company uses the step method to allocate support department costs to operating departments. In October, human resources incurred $1,008,000 of costs, administration incurred $1,562,400, and maintenance incurred $476,000. Proportions of services provided to other departments for October follow. Human Resources Administration Maintenance Human resources 10% 5% Administration 10% 15 Maintenance 15 10 Assembly 40 50 45 Finishing 35 30 35 a. Assume that the departments are listed in a benefits-provided ranking. Note: Do not round proportions in your calculations; round your final answer to the nearest whole dollar. 1. What amount of cost should be assigned from human resources to each of the other departments
Answer:
Leander Mfg.
Human resources cost assigned to other departments:
Administration 100,800 (10%)
Maintenance 151,200 (15%)
Assembly 403,200 (40%)
Finishing 352,800 (35%)
Total HR costs $1,008,000
Explanation:
a) Data and Calculations:
Human Resource Administration Maintenance
Direct costs incurred $1,008,000 $1,562,400 $476,000
Human resources 10% 5%
Administration 10% 15
Maintenance 15 10
Assembly 40 50 45
Finishing 35 30 35
Allocation of Costs:
Human Resource Administration Maintenance
Direct costs incurred $1,008,000 $1,562,400 $476,000
Human resources ($1,008,000) 100,800 151,200
Administration 100,800 (10%) ($1,663,200) 184,800
Maintenance 151,200 (15%) 184,800 (10%) ($812,000)
Assembly 403,200 (40%) 924,000 (50%) 456,750 (45%)
Finishing 352,800 (35%) 554,400 (30%) 355,250 (35%)
Human resources cost assigned to other departments:
Administration 100,800 (10%)
Maintenance 151,200 (15%)
Assembly 403,200 (40%)
Finishing 352,800 (35%)
Total HR costs $1,008,000
Administration costs assigned to other departments:
Maintenance 184,800 ($1,663,200 * 10/90)
Assembly 924,000 ($1,663,200 * 50/90)
Finishing 554,400 ($1,663,200 * 30/90)
Total administration costs $1,663,200
Maintenance costs assigned to other departments:
Assembly 456,750 ($812,000 * 45/80)
Finishing 355,250 ($812,000 * 35/80)
Total administration costs $812,000
Service levels are reported accurately is an example of which control
Answer:
Service level measures the performance of a system. Certain goals are defined and the service level gives the percentage to which those goals should be achieved. Fill rate is different from service level.
Examples of service level:
Percentage of calls answered in a call center.
Percentage of customers waiting less than a given fixed time.
Percentage of customers that do not experience a stockout.
Percentage of all parts of an order being fulfilled completely
(Explanation) if one component part of an order is not filled the Service Level for that order is Zero, If all the component parts of an order are delivered except one is filled at 51%, the service level for that order is 51% (This system is often used in supply chain delivery to manufacturing), This is a very different from a simple order fill measurement which does not consider line items on the order.
Explanation:
thank me later
Given below are several ratios. Select the accounts or amounts that would be used in order to calculate the ratio. You will have more than one response to each ratio. Some accounts or amounts may not be used at all. (Select all that apply.) Debt-to-equity ratio a.Cash paid for acquisitions b.Interest expense c.Total dividends paid d.Cash flow from operations before interest and tax payments e.Total stockholders' equity f.Net income g.Total liabilities h.Cash flow from operations
Answer:
Total stockholders' equity.Total liabilities.Explanation:
The Debt to equity ratio shows the proportions of the financing options used to finance the operations of the company namely debt and equity.
It is calculated by the formula:
= Total liabilities / Total stockholders' equity * 100%
As shown by the formula , the relevant accounts are:
Total stockholders' equity.Total liabilities.a. If a wage of $10.25 were to be imposed on this market, such that the market was not longer strictly competitive, what would be the value for labor supply?
b. At the imposed wage of $10.25 what would be the value for labor demand?
c. Provide a properly labeled and appropriately articulated Labor Market Model given the labor supply and demand equations provided and the imposed wage of $10.25.
d. Based on the labor market model you’ve now illustrated, how would you describe the current condition of this market given the imposed wage?
Solution :
Given the wage = $ 10.25 that is to be imposed to the market.
Given equation :
[tex]L_D[/tex] = 500 – 45W and [tex]L_S[/tex] = -200 + 25W
If the wage of $10.25 is to be imposed to the market, the value of the labor supply can be found by putting the value of the wage in the labor supply equation.
At W = 10.25
Putting this value in the above equation, the labor supply would be
[tex]L_S[/tex] = -200 + 25W
[tex]L_S[/tex] = -200 + 25(10.25)
= 56.25
When W = 10.25, the value for the labor demand can be found by :
[tex]L_D[/tex] = 500 – 45W
[tex]L_D[/tex] = 500 – 45(10.25)
[tex]L_D[/tex] = 500 – 461.25
[tex]L_D[/tex] = 38.75
Therefore, the labor demand and the labor supply model is
[tex]L_D[/tex] = 400 - 45 x 10.25
[tex]L_S[/tex] = -200 + 25 x 10.25
Dixie Bank offers a certificate of deposit with an option to select your own investment period. Jonathan has $8 comma 000 for his CD investment. If the bank is offering a 6 % interest rate, compounded annually, how much will the CD be worth at maturity if Jonathan picks a a. two -year investment period? b. six -year investment period? c. ten -year investment period? d. fifteen -year investment period?
Answer:
A = P * (1 + r/n)^nt. Where A = Maturity amount = ? P = Principal amount = $8,000, r = Rate of interest = 6%, n = Number of compounding per year = 1, t = Number of year
a. t = 2
A = $8,000 * (1 + 0.06/1)^1*2
A = $8,000 * (1.06)^2
A = $8,000 * 1.1236
A = $8,988.80
b. t = 6
A = $8,000 * (1 + 0.06/1)^1*6
A = $8,000 * (1.06)^6
A = $8,000 * 1.418519
A = 11348.152
A = $11,348.15
c. t = 10
A = $8,000 * (1 + 0.06/1)^1*10
A = $8,000 * (1.06)^10
A = $8,000 * 1.7908477
A = 14326.7816
A = $14,326.78
d. t = 15
A = $8,000 * (1 + 0.06/1)^1*15
A = $8,000 * (1.06)^15
A = $8,000 * 2.3965581931
A = 19172.4655448
A = $19,172.47
John Larken is a single taxpayer. He sells the home he has owned and lived in for the past 31 years for a gain of $200,000 on October 5, Year 33. How much of this gain may he exclude
Answer: $200000
Explanation:
It should be noted that the amount of gain that'll be excluded from the gross income under with respect to any sale should not be more than $250,000.
Therefore, the amount that'll be excluded based on this will be $200000. Therefore, the answer will be $200000.
Prepare journal entries to record the following transactions for Sherman Systems. a. Purchased 5,900 shares of its own common stock at $34 per share on October 11. b. Sold 1,225 treasury shares on November 1 for $40 cash per share. c. Sold all remaining treasury shares on November 25 for $29 cash per share.
Answer: See explanation
Explanation:
The journal entry to record the transaction for Sherman systems will be:
Oct-11
Debit Treasury Stock (5,900 × $34) =
$200,600
Credit Cash = $200,600
(To record repurchase of 5900 own shares)
Nov-01
Debit Cash (1,225 × $40) = $49,000
Credit Treasury stock (1,225 × $34) = $41,650
Credit Paid in capital-Treasury Stock = $7,350
(To record sale 1225 shares from treasury stock)
Nov-25
Debit Cash (5,900-1,225) × $29) = $135,575
Debit Paid in capital-Treasury Stock = $7,350
Debit Retained earnings = $16,025
Credit Treasury stock (5,900-1,225) × $34) = $158,950
(To record sale balance from treasury stock)
How are laws of supply and demand similar
Discuss how key practices in the partnering approach to managing contracted relationships vary from those in the traditional approach regarding risk, length of commitment, and structure of project teams.
Answer:
Approaches to risk, structure and length of commitment has been changed in a positive way.
Explanation:
Approaches to risk, structure and length of commitment has been changed in a positive way. Risk is greatly changed by introducing the following strategy:
Transfer, Avoid, Reduce and Accept.
The risk is analyzed first to identify the nature whether it can be transferred or not if yes it is transferred, if not then risk is again analyzed if this can be avoided, if not then risk is again analyzed if the chances of risk occurring can be reduced, if not then the risk is accepted.
Length of commitment is changed to easy terms, the length of commitment in the past was of a longer duration [more than a year], unlike now which is a choice, length of commitment can be less than a year or maybe more than a year.
A company took a physical inventory at the end of the year and determined that $833,000 of goods were on hand. In addition, the following items were not included in the physical count:
Management determined that $96,000 of goods purchased were in transit that were shipped f.o.b. destination (goods were actually received by the company three days after the inventory count)
The company sold $40,000 worth of inventory f.o.b. destination.
What amount should Bell report as inventory at the end of the year?
Answer:
$873,000
Explanation:
Calculation of amount of inventory reported by Bell at the end of year :
Inventory amount = $833,000 + $40,000
Inventory amount = $873,000
Therefore, the amount that Bell should report as inventory at the end of the year is $873,000.
Pistol Corporation purchased 100 percent ownership of Scope Products on January 1, 20X6, for $56,000, at which time Scope Products reported retained earnings of $10,000 and capital stock outstanding of $30,000. The differential was attributable to patents with a life of eight years. Income and dividends of Scope Products were
Answer:
1.20X6
1a. Dr Investment in Scope Products $56,000
Cr Cash $56,000
1b. Dr Cash $ 6,000
Cr Investment in Scope Products $ 6,000
1c. Dr Investment in Scope Products $16,000
Cr Income from Scope Products $16,000
1d. Dr Income from Scope Products $2,000
Cr Investment in Scope Products $2,000
20X7
2a. Dr Cash $8,000
Cr Investment in Scope Products $8,000
2b. Dr Investment in Scope Products $24,000
Cr Income from Scope Products $24,000
2c. Dr Income from Scope Products $2,000
Cr Investment in Scope Products $2,000
20X8
3a. Dr Cash $8,000
Cr Investment in Scope Products $8,000
3b. Dr Investment in Scope Products 32,000
Cr Income from Scope Products 32,000
3c. Dr Income from Scope Products $2,000
Cr Investment in Scope Products $2,000
2.$98,000
Explanation:
1. Preparation of the equity method entries that Pistol should record to account for this investment in 20X6, 20X7, and 20X8.
Equity Method Journal Entries for Pistol Corporation.
20X6
1a. Dr Investment in Scope Products $56,000
Cr Cash $56,000
1b. Dr Cash $ 6,000
Cr Investment in Scope Products $ 6,000
1c. Dr Investment in Scope Products $16,000
Cr Income from Scope Products $16,000
1d. Dr Income from Scope Products $2,000
Cr Investment in Scope Products $2,000
{ ($56,000-$10,000-$30,000) /8 years }
20X7
2a. Dr Cash $8,000
Cr Investment in Scope Products $8,000
2b. Dr Investment in Scope Products $24,000
Cr Income from Scope Products $24,000
2c. Dr Income from Scope Products $2,000
Cr Investment in Scope Products $2,000
{ ($56,000-$10,000-$30,000) /8 years }
20X8
3a. Dr Cash $8,000
Cr Investment in Scope Products $8,000
3b. Dr Investment in Scope Products 32,000
Cr Income from Scope Products 32,000
3c. Dr Income from Scope Products $2,000
Cr Investment in Scope Products $2,000
{ ($56,000-$10,000-$30,000) /8 years }
2. Calculation to determine the Balance in Investment in Scope Products.
Particulars Amount ($)
Initial Investment Amount $56,000
Add : Share of Income $72,000
($16,000+$24,000+$32,000)
Less : Dividend Received ($22,000)
($6,000+$8,000+$8,000)
Less : Patent Amortization ($6,000)
($2,000 * 3 years)
Balance in Investment in Scope Products Account as on Dec. 31 20X8 $98,000
Therefore the balance of the Investment in Scope account on Pistol balance sheet at December 31, 20X8, after all required equity method entries have been recorded is $98,000
