If the par value method is used, the amount debited to share premium would be P178,000.
In connection with the retirement of shares, the amount debited to share premium would depend on the specific accounting treatment chosen by the CFAS Company. There are two common methods for handling the retirement of shares: the par value method and the stated value method.
1. Par Value Method:
Under the par value method, when shares are retired, the amount debited to share premium is the excess of the original issue price over the par value of the shares retired.
In this case, the shares were issued at P99 per share with a par value of P10. Therefore, the share premium at the time of issuance is P99 - P10 = P89 per share.
Since 2,000 shares were retired, the amount debited to share premium would be:
P89 per share x 2,000 shares = P178,000
So, if the par value method is used, the amount debited to share premium would be P178,000.
2. Stated Value Method:
Under the stated value method, when shares are retired, the amount debited to share premium is based on a predetermined stated value per share.
However, since the problem does not provide any information regarding the stated value, it is not possible to determine the exact amount debited to share premium using this method.
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You Are The Audit Partner Of Pride Ltd And You Have Been Assigned To Audit Bee Ltd At The End Of The Financial Year Of December 2018. You Are Responsible For Checking The Receivables Of The Company Which Constitute To A Large Amount In The Statement Of Financial Position Because The Company Trades On Credit Basis With Its Customers. Bee Ltd Maintains An Aged
You are the audit partner of Pride Ltd and you have been assigned to audit Bee Ltd at the end of the financial year of December 2018. You are responsible for checking the receivables of the company which constitute to a large amount in the statement of financial position because the company trades on credit basis with its customers. Bee Ltd maintains an aged receivable listing of all its credit customers as well as up-to-date ledger accounts. Required: Set out, in a manner suitable for inclusion in the audit plan, the audit procedures to be undertaken to ensure that the receivables are fairly stated in the financial statements for the year ended 31 December 2018.
Audit Procedures for Receivables:
Obtain the aged receivable listing from Bee Ltd and review it for completeness and accuracy. Compare the total receivables balance on the listing to the general ledger balance.
Select a sample of credit customers from the aged receivable listing and agree the individual customer balances to the corresponding ledger accounts. Verify that the amounts recorded in the ledger accounts match the aged receivable listing.
Perform a cutoff test to ensure that sales transactions are recorded in the correct accounting period. Select a sample of sales invoices near the year-end and verify that they are properly recorded in the sales journal and the corresponding receivable accounts.
Review the credit terms and conditions of Bee Ltd's sales contracts and agreements. Ensure that the terms are properly applied to determine the appropriate recognition and valuation of receivables.
Confirm a sample of customer balances directly with the customers. Send confirmation requests to the selected customers and verify the accuracy and completeness of their balances. Follow up on any discrepancies or non-responses.
Perform a review of the allowance for doubtful accounts. Examine the company's methodology for estimating bad debt reserves and assess its reasonableness. Evaluate the adequacy of the allowance for doubtful accounts by comparing it to historical bad debt write-offs and current economic conditions.
Analyze the aging of receivables to identify any significant or unusual balances. Investigate any large or long overdue accounts for potential collectability issues or disputes.
Test the completeness and accuracy of cash receipts recorded in the cash receipts journal. Select a sample of cash receipts and trace them to the corresponding receivable accounts to ensure proper recording.
Perform a reconciliation of the total receivables balance to the general ledger. Verify that any reconciling items are properly identified and resolved.
Assess the adequacy of internal controls over receivables. Evaluate the company's credit approval process, billing procedures, and collection policies. Identify any weaknesses or areas for improvement.
Document any significant findings or exceptions identified during the audit procedures and discuss them with management.
Formulate an overall conclusion on the fairness of the receivables balances in the financial statements based on the results of the audit procedures performed.
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If the worker's productivity of calculators sold by Sony increase 20%, then the: A supply of labor to Sony decreases B supply of labor to Sony increases C demand for labor to Sony increases D demand for labor to Sony decreases
(Option D) demand for labor to Sony increases. Sony would require more workers to meet the increased demand and take advantage of the improved productivity, leading to an increase in the demand for labor.
When the worker's productivity of calculators sold by Sony increases by 20%, it implies that each worker can now produce more calculators in a given amount of time. This increase in productivity leads to an increase in the demand for labor by Sony.
When workers are more productive, Sony can produce a greater quantity of calculators with the same amount of labor. This creates a need for additional workers to meet the increased demand for calculators. As a result, the demand for labor to Sony increases.
An increase in productivity typically leads to higher efficiency and lower costs for the firm. With increased productivity, Sony can expand its operations, increase production, and potentially enter new markets. This growth in the firm's activities requires a greater workforce, thus increasing the demand for labor. Therefore, the correct answer is that the demand for labor to Sony increases.
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harvey quit his job at state university, where he earned $50,000 a year. he figures his entrepreneurial talent or forgone entrepreneurial income to be $7,000 a year. to start the business, he cashed in $80,000 in bonds that earned 10 percent interest annually to buy a software company, extreme gaming. in the first year, the firm sold 12,000 units of software at $70 for each unit. of the $70 per unit, $52 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. the economic profits of harvey's firm in the first year were
Consider the revenues and costs associated with the business to calculate the economic profits of Harvey's firm. The economic profits of Harvey's firm in the first year were $8,400.
To calculate the economic profits of Harvey's firm in the first year, we need to consider the revenues and costs associated with the business. The firm sold 12,000 units of software at $70 per unit, resulting in total revenue of $840,000 (12,000 units * $70 per unit).
From the $70 per unit, $52 goes towards the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. Therefore, the total costs for the year amount to $624,000 (12,000 units * $52 per unit).
To determine the economic profits, we subtract the total costs from the total revenue: $840,000 - $624,000 = $216,000.
However, we also need to consider the forgone entrepreneurial income and the opportunity cost of the $80,000 in bonds that Harvey cashed in. Harvey's forgone entrepreneurial income is $7,000 per year, and the interest he could have earned on the $80,000 in bonds is 10% annually, which amounts to $8,000.
Subtracting the forgone entrepreneurial income and the opportunity cost from the calculated profits: $216,000 - $7,000 - $8,000 = $201,000 - $15,000 = $186,000.
Therefore, the economic profits of Harvey's firm in the first year were $186,000.
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what loan provision requires a borrower to pay off the entire loan when the property is sold?
The loan provision that requires a borrower to pay off the entire loan when the property is sold is the due-on-sale clause.
A due-on-sale clause, also known as an acceleration clause, is a mortgage clause that demands that the entire outstanding balance be repaid when a mortgaged property is sold or transferred. The due-on-sale clause is a provision in a mortgage agreement that requires the borrower to repay the loan in full when the home is sold or transferred to another owner.
The bank or lender is given the right to claim the entire loan balance immediately due if the borrower transfers ownership of the property to someone else. The due-on-sale clause is added to a mortgage agreement to protect the lender's interests in the event of a transfer of ownership.
By enforcing the due-on-sale clause, lenders can ensure that the loan remains secured by the property and that the new owner meets the lender's creditworthiness criteria. This provision helps lenders manage their risks and maintain control over the terms of the loan.
It's important for borrowers to be aware of the due-on-sale clause when entering into a mortgage agreement, as selling the property without satisfying the loan obligations may trigger the lender's right to accelerate the loan and demand full repayment
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Enneagon Pty Ltd is a manufacturing firm that produces customised office gifts according to customers' orders. The company adopts the job order costing system, and manufacturing overhead is allocated to production at a predetermined overhead rate of 200 percent of direct material cost. According to the company's policy, any over-or under-allocated manufacturing overhead is written off to the cost of goods sold. The firm does not have any work-in-process at the beginning or end of the quarter. Below is the financial information for the 4th quarter of 2021: Direct material used Direct labour cost incurred Indirect labour cost incurred Indirect material used Selling and administrative expenses Depreciation of factory building Depreciation of factory equipment Insurance on factory and equipment Electricity for factory Finished goods inventory, October 1st Finished goods inventory, December 31 $220,000 $700,000 $130,000 $80,000 $600,000 $100,000 $70,000 $50,000 $30,000 $0 $500,000 (a) Calculate the cost of goods manufactured for the company for the 4th quarter of 2021. Clearly show the workings of the calculation. (b) Calculate the difference between the actual manufacturing overhead cost incurred and the manufacturing overhead cost allocated. Identify whether it is under- allocated or over-allocated. Clearly show the workings of the calculation. (c) Calculate the adjusted cost of goods sold for the 4th quarter of 2021. Clearly show the workings of the calculation.(d) Provide one reason why firms use budgeted overhead allocation rate to allocate manufacturing overhead rather than use the actual manufacturing overhead cost and justify your answer. (e) The company considers if there are alternative adjustment methods for the over- or under-allocated manufacturing overhead. Suggest one alternative adjustment for the company to consider. In the context of Enneagon Pty Ltd, would it be better for the manager to follow the existing policy or to switch to the alternative adjustment method you suggest? Explain.
The existing policy of writing off under or over-allocated manufacturing overhead to the cost of goods sold is not appropriate because it results in distorted product costs and also affects the company's profitability.
(a) Calculation of the cost of goods manufactured for the company for the 4th quarter of 2021: Enneagon Pty Ltd Cost of Goods Manufactured for the 4th Quarter of 2021 Direct Material used $220,000
Direct Labour Cost incurred $700,000 Manufacturing Overhead Allocated (200% of DM used) $440,000
Total Manufacturing Cost $1,360,000 Add: Work in Process (WIP), October 1st $0 Less: Work in Process (WIP), December 31 ($0) Cost of Goods Manufactured $1,360,000
(b) Calculation of the difference between the actual manufacturing overhead cost incurred and the manufacturing overhead cost allocated:
Enneagon Pty Ltd Calculation of Manufacturing Overhead (OH) Allocated and Actual Manufacturing Overhead (OH) Cost Incurred Direct Material Cost $220,000
Manufacturing Overhead Allocated (200% of Direct Material Cost) $440,000 Actual Manufacturing Overhead Cost Incurred $320,000
Difference between Actual Manufacturing OH Cost and OH allocated (OH Under-allocated) $120,000
Enneagon Pty Ltd should consider prorating the under-or over-allocated manufacturing overhead to the cost of goods sold and work-in-process, rather than writing it off entirely to the cost of goods sold.
By doing so, the cost of the product becomes more accurate and reflects the cost of production more effectively.
The existing policy of writing off under or over-allocated manufacturing overhead to the cost of goods sold is not appropriate because it results in distorted product costs and also affects the company's profitability.
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Betsy Strand's regular hourly wage rate is $16, and she receives an hourly rate of $24 for work in excess of 40 hours. During a January pay period, Betsy works 47 hours. Betsy's federal income tax withholding is $95, and she has no voluntary deductions. Assume that the FICA tax rate is 7.65%. Prepare the employer's journal entries to record (a) Betsy's pay for the period and (b) the payment of Betsy's wages. Use January 15 for the end of the pay period and the payment date. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation Debit Credit (a) Jan. 15 (b) Jan. 15 ||| Current Attempt in Progress X Your answer is incorrect. Skysong, Inc. had checks outstanding totaling $27900 on its May bank reconciliation. In June, Skysong, Inc. issued checks totaling $174500. The June bank statement shows that $129900 in checks cleared the bank in June. A check from one of Skysong, Inc.'s customers in the amount of $1300 was also returned marked "NSF." The amount of outstanding checks on Skysong, Inc.'s June bank reconciliation should be $16700. O $71200. O $72500. $44600. Attempts: 1 of 2 used Submit Answer Save for Later Current Attempt in Progress Ivanhoe Company is preparing a cash budget for September. The company's cash balance on September 1 is $27840. The company anticipates cash receipts of $134160 and cash disbursements of $140780. If Ivanhoe Company desires a cash balance of $28800, it must acquire financing of $960. O acquire financing of $5660. acquire financing of $22180. O acquire financing of $7580. Save for Later Attempts: 0 of 2 used Submit Answer View Policies Current Attempt in Progress Sheridan Company had net credit sales during the year of $1047750 and cost of goods sold of $484000. The balance in accounts receivable at the beginning of the year was $110400 and at the end of the year was $143600. What was the accounts receivable turnover? O 8.3 O 10.3 O 5.1 O 7.0 Save for Later Attempts: 0 of 2 used Submit Answer View Policies Current Attempt in Progress A company purchased factory equipment on April 1, 2022 for $162000. It is estimated that the equipment will have a $18000 salvage value at the end of its 10-year useful life. Using the straight-line method of depreciation, the amount to be recorded as depreciation expense at December 31, 2022 is O $10800. O $14400. O $16200. O $12150. Save for Later Attempts: 0 of 2 used Submit Answer Splish Brothers Inc. lends Bramble industries $62400 on August 1, 2022, accepting a 9-month, 9% interest note. If Splish Brothers Inc. accrued interest at its December 31, 2022 year-end, what entry must it make to record the collection of the note and interest at its maturity date? Cash 66612 Notes Receivable 62400 Interest Receivable 2340 Interest Revenue 1872 Notes Receivable 66612 O Cash Notes Receivable Interest Receivable Interest Revenue Cash Cash Notes Receivable Interest Revenue 66612 62400 2340 1872 66612 66612 62400 4212
a) January 15 (a) Wage expense (b) Federal income tax payable, FICA tax payable, cash
b) January 15 (a) Federal income tax payable, FICA tax payable, cash (b) Wage payable
To prepare the employer's journal entries to record Betsy's pay for the period, the following accounting entries should be made:
a) January 15: Wage expense - $752.00 ($640.00 regular pay and $112.00 overtime pay) Federal income tax payable - $95.00 FICA tax payable - $57.68 Cash - $599.32
(b) January 15: Federal income tax payable - $95.00 FICA tax payable - $57.68 Wage payable - $752.00 Cash - $599.32
To calculate the amount of regular pay and overtime pay:
Regular pay = 40 hours x $16/hour = $640Overtime pay = 7 hours x $24/hour = $168
To calculate FICA tax payable:
FICA tax payable = (FICA tax rate) x (total pay)
FICA tax rate = 7.65%Total pay = $752.00
Therefore, FICA tax payable = 0.0765 x $752.00 = $57.68
To calculate the number of outstanding checks on Skysong, Inc.'s June bank reconciliation:
Outstanding checks = (outstanding checks from previous period) + (checks issued during the period) - (checks that cleared the bank during the period) + (NSF check)Outstanding checks from previous period = $27,900
Checks issued during the period = $174,500
Checks that cleared the bank during the period = $129,900
NSF check = $1,300
Therefore, outstanding checks = $27,900 + $174,500 - $129,900 + $1,300 = $72,900
3. Accounts receivable turnover = net credit sales ÷ average accounts receivable
Average accounts receivable = (beginning accounts receivable + ending accounts receivable) ÷ 2
Average accounts receivable = ($110,400 + $143,600) ÷ 2 = $127,000
Accounts receivable turnover = $1,047,750 ÷ $127,000 = 8.25 times
4. Depreciation expense = (cost - salvage value) ÷ useful life
Depreciation expense = ($162,000 - $18,000) ÷ 10 years = $14,400 per year
5. The entry to record the collection of the note and interest at its maturity date is:
Cash $66,612 Notes receivable $62,400 Interest receivable $2,340 Interest revenue $1,872 Notes receivable $66,612.
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What is the eventual effect on real GDP if the government increases its purchases of goods and services by $50,000 ? Assume the marginal propensity to consume (MPC) is 0.75 . What is the eventual effect on real GDP if the government, instead of changing its spending, increases transfers by $50,000 ? Assume the MPC has not changed.
Main answer:The eventual effect on real GDP, if the government increases its purchases of goods and services by $50,000, can be calculated by the following steps:Increase in government purchases = $50,000Multiplier = 1 / (1 - MPC) = 1 / (1 - 0.75) = 4Change in real GDP
Increase in government purchases x Multiplier= $50,000 x 4= $200,000Therefore, the eventual effect on real GDP would be an increase of $200,000 if the government increases its purchases of goods and services by $50,000.The eventual effect on real GDP if the government increases transfers by $50,000 and MPC remains the same can be calculated by the following steps:Increase in transfers = $50,000Multiplier = MPC / (1 - MPC) = 0.75 / (1 - 0.75) = 3Change in real GDP = Increase in transfers x Multiplier= $50,000 x 3= $150,000Therefore, the eventual effect on real GDP would be an increase of $150,000 if the government increases transfers by $50,000:In economics, the multiplier effect refers to the phenomenon where a small change in spending leads to a much larger change in real GDP. The multiplier effect occurs because the initial spending sets off a chain reaction of additional spending as the recipients of the initial spending use their newfound income to purchase goods and services themselves.
In the given problem, we have been given the change in government purchases and transfers, and we have been asked to calculate the eventual effect on real GDP. We have also been given the MPC, which tells us what proportion of an additional dollar of income will be spent on consumption. Suppose the government increases its purchases of goods and services by $50,000. This will increase the income of those who provide those goods and services, and they will in turn use that income to purchase other goods and services, thereby increasing the income of those providers as well. This process will continue in a chain reaction, with each round of spending increasing the income of others in turn. The eventual effect on real GDP is the sum total of all these rounds of spending. Using the multiplier formula, we can calculate the eventual effect on real GDP as: Change in real GDP = Increase in government purchases x Multiplier= $50,000 x 4= $200,000Now suppose the government increases transfers by $50,000 instead of changing its spending. In this case, the recipients of the transfers will have additional income, but since this is a transfer and not a purchase, there will be no direct increase in output or employment. However, the recipients will use some of their newfound income to purchase additional goods and services, thereby setting off a chain reaction of spending similar to the one described above. Using the multiplier formula with MPC instead of 1 - MPC, we can calculate the eventual effect on real GDP as:Change in real GDP = Increase in transfers x Multiplier= $50,000 x 3= $150,000
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When the actual sales-mix shifts toward a mix of products with lower contribution margins, there will be negative effects on a firm's:
Sales mix and sales quantity variances.
Sales volume and market mix variances.
Sales quantity and sales volume variances.
The following information for the past year is available from Gas Company, a company that uses machine hours to apply standard factory overhead cost to outputs:
Actual total factory overhead cost incurred $ 31,000
Actual fixed overhead cost incurred $ 18,000
Budgeted fixed overhead cost $ 13,000
Actual machine hours 8,000
Standard machine hours allowed for the units manufactured 5,500
Denominator volume—machine hours 6,200
Standard variable overhead rate per machine hour $ 3
2. Under a three-variance breakdown (decomposition) of the total factory overhead variance, the total factory overhead spending variance is:
$6,000 favorable.
$4,600 unfavorable.
$0.
$5,400 favorable.
$5,400 unfavorable.
Sales mix and sales volume variances.
Market mix and sales mix variance.
3. The master budget variance for a period reveals whether a company has achieved:
The sales level budgeted for the period.
Control of total expenses for the period.
Control of basic business processes.
An adequate return on investment (assets) during the period.
The master budgeted operating income for the period.
4. The development and implementation of a comprehensive framework for managing and controlling quality is best accomplished through which type of company interaction?
Executive decision making.
Board of directors meeting.
Divisional interaction.
Market research.
Cross-functional effort.
When the actual sales-mix shifts toward a mix of products with lower contribution margins, there will be negative effects on a firm's Sales mix and sales quantity variances. Shifting to products with lower contribution margins, results in lowering the selling price, reducing the sales quantity and impact the product's sales mix.
A lower sales mix leads to a decrease in the contribution margin which results in lower profitability. Hence, the sales quantity and sales volume variances of a company may decrease when it shifts towards lower contribution margin products.
The answer to the question is that sales mix and sales quantity variances will be affected if the actual sales-mix shifts towards a mix of products with lower contribution margins. Let us discuss the other question one by one:2. Under a three-variance breakdown (decomposition) of the total factory overhead variance, the total factory overhead spending variance is $6,000 favorable. 3.
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The entity reported the following information in 2020:
Cost of goods sold 500,000
Interest expense 10,000
Income tax expense 25,000
Operating expenses 190,000
Sales revenue 800,000
Instructions: Type the numerical answer 1, 2, 3. or 4 in the box after the question.
A. How much is to be reported as gross profit? Blank 1
1) 300,000
2) 110,000
3) 100,000
4) 75,000
B. How much is to be reported as net income? Blank 2
1) 300,000
2) 110,000
3) 100,000
4) 75,000
A. The gross profit to be reported is $300,000 (Answer 1). Gross profit is calculated by subtracting the cost of goods sold (COGS) from the sales revenue.
In this case, the COGS is $500,000, and the sales revenue is $800,000. Subtracting the COGS from the sales revenue gives us $800,000 - $500,000 = $300,000, which is the gross profit. Therefore, the correct answer is 1) $300,000. Gross profit represents the amount of money left after accounting for the direct costs of producing the goods sold, and it provides an indication of the profitability of the company's core operations. In this scenario, the gross profit of $300,000 suggests that the company generated a healthy profit margin from its sales.
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In 1000 words,
Please tell us about your involvement in school and/or community activities in a few sentences. What does this scholarship mean to you and your education, and how are you preparing for a successful future?
Active participation in school and community activities can have numerous benefits for students. It allows them to develop leadership skills, time management, and a sense of social responsibility.
Involvement in extracurricular activities such as clubs, sports teams, volunteering, or community service can also provide opportunities for personal growth, networking, and expanding one's horizons.
Regarding scholarships, they can play a vital role in a student's education. Scholarships provide financial support, reducing the burden of tuition fees and expenses, and enabling students to pursue higher education or specific career paths. Scholarships can open doors to opportunities that might not have been feasible otherwise, and they recognize and reward students' achievements and potential.
In preparing for a successful future, students can focus on academic excellence, developing relevant skills, seeking mentorship, exploring internships or job shadowing opportunities, and pursuing their passions. They can also engage in continuous learning, be proactive in seeking new experiences, and make use of available resources to enhance their knowledge and skills in their chosen fields. Ultimately, a successful future is built upon a strong foundation of education, dedication, and perseverance.
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If you are willing to pay $28,017.00 today to receive a
perpetuity with the first payment occurring next year then the
payment must be $______. Assume a 13.00% discount rate. Answer
format: Currency:
To calculate the payment amount for a perpetuity, we can use the formula: Payment = Present Value / Discount Rate
In this case, the present value is $28,017.00, and the discount rate is 13.00%.
Substituting these values into the formula, we have:
Payment = $28,017.00 / 0.13
Payment = $2155.15 (rounded to two decimal places)
Therefore, if you are willing to pay $28,017.00 today to receive a perpetuity with the first payment occurring next year, the payment amount would be approximately $2155.15.
A perpetuity is an investment that provides a fixed payment indefinitely, so you would receive $2155.15 each year, starting from the year after your initial payment.
It's important to note that perpetuities are theoretical financial instruments and not commonly found in practice, as most investments have a finite term.
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.Fill in the blanks to complete the passage about the role of the FDIC.
The Federal Deposit InsuranceDeposit Insurance Corporation makes sure –SELECT A LABELrisk-averse behaviorDebt InsuranceDeposit Investmentbank runsGreat Depressionexcess reservesGreat Recessionmoral hazardDeposit Interestdepositorsbank ownersbank loans get their money back if an insured bank fails. This agency was implemented during the –SELECT A LABELrisk-averse behaviorDebt InsuranceDeposit Investmentbank runsGreat Depressionexcess reservesGreat Recessionmoral hazardDeposit Interestdepositorsbank ownersbank loans in response to the high number of bank failures. The peace of mind the FDIC provided depositors resulted in a decreased frequency of –SELECT A LABELrisk-averse behaviorDebt InsuranceDeposit Investmentbank runsGreat Depressionexcess reservesGreat Recessionmoral hazardDeposit Interestdepositorsbank ownersbank loans. However, since banks and their customers are no longer fully exposed to risk, there is increased potential for –SELECT A LABELrisk-averse behaviorDebt InsuranceDeposit Investmentbank runsGreat Depressionexcess reservesGreat Recessionmoral hazardDeposit Interestdepositorsbank ownersbank loans.
risk-averse behavior
Debt Insurance
Deposit Investment
bank runs
Great Depression
excess reserves
Great Recession
moral hazard
Deposit Interest
depositors
bank owners
bank loans
The main answer is the Federal Deposit Insurance Corporation makes sure depositors get their money back if an insured bank fails.
he Federal Deposit Insurance Corporation (FDIC) is an agency of the United States government that provides deposit insurance, which guarantees the safety of deposits in member banks. This is to ensure that depositors get their money back if an insured bank fails. The FDIC was implemented during the Great Depression in response to the high number of bank failures.
The peace of mind the FDIC provided depositors resulted in a decreased frequency of bank runs. This means that depositors were less likely to panic and withdraw their money all at once from a bank since they were confident that their deposits were insured by the FDIC.However, since banks and their customers are no longer fully exposed to risk, there is increased potential for moral hazard. Moral hazard refers to the increased likelihood that a bank or its customers will take on more risk than they would otherwise, knowing that they are protected by deposit insurance.
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what should a treasury staff do to improve forecasting accuracy
To improve forecasting accuracy, treasury staff can take the following steps:
Gather and Analyze Data: Ensure that relevant and reliable data is collected and analyzed from various sources, including historical financial records, market trends, economic indicators, and industry data. This data should be used to identify patterns, trends, and potential risks that can impact forecasts.
Use Advanced Analytics Techniques: Utilize advanced analytics techniques, such as statistical models, regression analysis, and predictive modeling, to enhance the accuracy of forecasts. These techniques can help identify relationships between variables, predict future outcomes, and account for uncertainties.
Collaborate with Stakeholders: Engage in regular communication and collaboration with key stakeholders, such as sales teams, procurement, finance, and operations, to gather insights and validate assumptions. Incorporate their inputs into the forecasting process to improve accuracy and alignment with business goals.
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Discuss the effectiveness of non-price forms of competition such
as, (i) advertising and (ii) innovation (new products and new
processes) on firm performance and consumer welfare. (750
words)
Non-price forms of competition include advertising and innovation. Both of these forms of competition can be highly effective in improving the performance of a firm and enhancing consumer welfare.
Advertising is one of the most common methods used by businesses to gain a competitive advantage. It involves promoting a company's products or services to its target audience through various media channels such as television, radio, print, online, and social media. Advertising can be used to create brand awareness, inform customers about the features and benefits of a product or service, and persuade them to make a purchase. Moreover, advertising can be used to differentiate a company's products from its competitors' products by highlighting unique features and benefits.
Innovation is another effective form of competition. It involves the development and implementation of new products and processes that can improve a company's performance and enhance consumer welfare. Innovation can be in the form of new products, new services, or new ways of delivering existing products or services to customers. Advertising can help companies increase their market share, build customer loyalty, and generate more revenue. Innovation can help companies gain a competitive advantage by offering unique products or services, reducing costs, and improving the quality of their products and services. Therefore, firms that invest in advertising and innovation can achieve greater success in the marketplace.
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Moving to another question will save this response. Question 8 The primary activity which was selected did not have the most relevance for the circumstances is a description of which reason why interventions fail? O wrong problem O wrong intervention O unskilled change agent O unclear or overambitious goals Moving to another question will save this response. 0.5 pol
The reason why interventions fail due to the primary activity selected not being the most relevant for the circumstances is because of the wrong intervention.
When interventions fail, one of the key reasons can be attributed to the implementation of the wrong intervention. This means that the selected course of action or activity does not align with the specific circumstances or needs of the situation. Interventions are designed to address specific problems or challenges within an organization or system. However, if the intervention chosen is not the most relevant or appropriate for the given circumstances, it is likely to result in failure or ineffective outcomes.
The success of an intervention depends on accurately diagnosing the problem and selecting an intervention that directly addresses the root causes. If there is a misalignment between the intervention and the actual problem at hand, it can lead to wasted resources, time, and effort, ultimately resulting in failure. Therefore, it is essential to carefully assess the situation, consider all relevant factors, and choose the most suitable intervention that directly addresses the identified problem. Failing to do so can hinder the effectiveness of the intervention and undermine its potential for success.
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The supply and demand model
a tries to include as many realistic details as possible in order to provide insights into real-world competitive markets
b uses simplifying assumptions while still providing insights into real-world competitive markets
c uses simplifying assumptions that severely limit its usefulness in practice
d is too complicated to be useful in practice
e is unable to explain price movements in most real-world competitive markets
The correct answer would be option b: The supply and demand model uses simplifying assumptions while still providing insights into real-world competitive markets. The supply and demand model is one of the most fundamental concepts of economics.
It is used to explain how prices are set and how they change in response to fluctuations in demand or supply. The model is based on the idea that the price of a good or service is determined by the interaction of supply and demand.
While the real world is more complex, the model simplifies reality in order to provide insights into real-world competitive markets. This means that the model makes assumptions about how the market works that are not always accurate. However, these assumptions are made in order to make the model more useful for understanding how prices are set and how they change in response to changes in supply and demand.
Some of the simplifying assumptions made by the supply and demand model include that there are many buyers and sellers in the market, that all buyers and sellers have perfect information, that goods are homogeneous, and that there are no barriers to entry into the market. While these assumptions are not always accurate in the real world, they still provide useful insights into how prices are set and how they change over time.
Overall, the supply and demand model is a useful tool for understanding how prices are set in competitive markets. While the model makes simplifying assumptions that are not always accurate, these assumptions are made in order to make the model more useful for understanding how markets work in the real world.
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An undesirable by-product of the factory system was: O a. Lack of strong government regulation O b. Higher taxes for the factory owners Oc. The creation of labor unions Od. Abuse of unskilled workers and children
An undesirable by-product of the factory system was: Od. Abuse of unskilled workers and children.
The factory system during the Industrial Revolution led to exploitative working conditions, particularly for unskilled workers and children.
With the rise of factories and mass production, there was a high demand for labor, and workers, including women and children, were often subjected to long working hours, low wages, dangerous working conditions, and lack of basic rights and protections.
The factory owners prioritized profits over the well-being of their workers, leading to the exploitation and abuse of vulnerable individuals, including unskilled workers and children.
This exploitation eventually sparked social movements and the formation of labor unions, as workers sought better working conditions and fair treatment.
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Question 3. Consider an economy in which the production function of the representative firm is given by the following form Y = z^1/3N^2/3, where z = 0.5. a. Does the production function have the constant return to scale property? (Show it mathematically) b. Assuming that firm operates with a capital K = 4 in the short-run. Does the production function display the law of decreasing marginal product? (Show it mathematically) c. Find the labor demand function and the optimal demand when w = 1.5.
a. Production function and constant return to scale: Y = z1/3 N2/3, where z = 0.5.Production function denotes the connection between the output and the inputs required to produce that output. It shows how much output is possible from a given combination of inputs under the existing technological situation.
A production function depicts constant returns to scale if a change in all inputs at a certain percentage results in a change in output at the same percentage. :If a production function represents constant returns to scale, then for λ > 0,Y(λK, λN) = λY(K, N).Here, Y = z1/3 N2/3, where z = 0.5.Using the definition, we can say that the production function depicts constant returns to scale if, Y(λK, λN) = λY(K, N).
So, Y(λK, λN) = (0.5)1/3 (λN)2/3Y(K, N) = (0.5)1/3N2/3Then, λ0.5(1/3)(λN)2/3 = 0. 5(1/3)N2/3Simplifying this equation, λ(λN)2/3 = N2/3λλ2/3 = 1λ = 1So, the above equation satisfies the constant returns to scale property.
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Conduct an analysis of market structures:
Are perfectly competitive markets and their outcomes more preferred than monopolies? Compare the market structures and perfect competition and monopolies, and analyse the advantages and disadvantages of these market structures from the perspective of consumers, producers and a welfare maximising government.
Perfectly Competitive Markets:
In a perfectly competitive market, there are numerous buyers and sellers, homogeneous products, perfect information, ease of entry and exit, and no individual participant has the ability to influence prices. Some advantages and disadvantages of perfectly competitive markets are:
Advantages for Consumers:
Lower prices: Intense competition drives prices down, benefiting consumers who can purchase goods and services at lower costs.
Increased choices: With many sellers offering similar products, consumers have a wide range of options to choose from.
Consumer sovereignty: Consumers have the power to make choices based on their preferences, as sellers are forced to cater to consumer demands.
Advantages for Producers:
Level playing field: Producers have an equal opportunity to enter the market and compete based on their efficiency and quality of products.
Incentive for efficiency:
motivates producers to improve their production processes, reduce costs, and innovate to stay competitive.
Disadvantages for Consumers:
Lack of product differentiation: Homogeneous products may limit consumer preferences for variety or uniqueness.
Potential for market failure: Perfectly competitive markets may not allocate resources efficiently in the presence of externalities or public goods.
Disadvantages for Producers:
Limited market power: Individual producers have no market power and may struggle to earn significant profits in the long run.
Price takers: Producers must accept the prevailing market price determined by supply and demand forces.
Advantages for Welfare Maximizing Government:
Efficient allocation of resources: Perfect competition helps allocate resources more efficiently, leading to a higher overall level of economic welfare.
Consumer protection: Competition can drive producers to maintain quality and offer better customer service to attract and retain consumers.
Monopolies:
In a monopoly, a single firm dominates the market and faces no competition. This lack of competition grants the monopolist significant market power. Here are the advantages and disadvantages of monopolies:
Potential economies of scale: Monopolies may have the ability to achieve economies of scale, which can lead to lower average costs and potentially lower prices for consumers.
Innovation and R&D: Monopolies may have more financial resources to invest in research and development, leading to technological advancements and innovative products.
Disadvantages for Consumers:
Higher prices: Monopolies can charge higher prices due to their market power and lack of competition.
Limited choices: With no or limited competition, consumers may have fewer options to choose from, reducing their ability to find products that best match their preferences.
Advantages for Producers:
Higher profits: Monopolies can earn substantial profits due to their ability to set prices and control the market.
Market dominance: Monopolies enjoy a dominant position, allowing them to influence market trends and dictate terms to suppliers.
Disadvantages for Producers:
Lack of competitive pressure: Without competition, there may be less incentive for monopolies to innovate, improve efficiency, or respond to consumer demands.
Lack of consumer trust: Monopolies can face public scrutiny and distrust due to their market dominance and potential for abuse.
Advantages for Welfare Maximizing Government:
Regulating market power: Governments can regulate monopolies to prevent abuse of market power and protect consumer interests.
Promoting competition: Governments can introduce policies to encourage competition and prevent monopolistic practices.
Comparing Perfect Competition and Monopolies:
Perfect competition tends to benefit consumers through lower prices, increased choices, and consumer sovereignty. It also promotes efficiency and innovation among producers. However, monopolies can lead to economies of scale, potential innovation, and higher profits for producers. Nevertheless, they often result in higher prices, limited choices for consumers, and reduced competitive pressure. Governments play a role in ensuring
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1) Consider the following information:
State Probability Stock A Stock B Stock C
Boom 0.65 0.23 0.20 0.14
Bust 0.35 0.01 0.05 0.27
What is the expected return on an equally weighted portfolio of these three stocks? (Hint: Equally means that each stock has the same weight. Given that there are only 3 stocks, each has a weight of 1/3) Enter the answer with 4 decimals (e.g. 0.1234).
2)
Consider the following information:
State Probability Stock A Stock B Stock C
Boom 0.32 0.10 0.15 0.28
Bust 0.68 -0.05 0.25 -0.06
What is the expected return of a portfolio that has invested $13200 in Stock A, $9400 in Stock B, and $14500 in Stock C? (Hint: calculate weights of each stock first). Enter the answer with 4 decimals (e.g. 0.1234).
The expected return of the portfolio is 0.1867 (rounded to 4 decimal places).
The expected return on an equally weighted portfolio of these three stocks can be calculated by taking the weighted average of the expected returns of each stock. Since each stock has an equal weight of 1/3, we can calculate it as follows:
Expected return = (Probability of Boom * Return of Stock A) + (Probability of Boom * Return of Stock B) + (Probability of Boom * Return of Stock C)
+ (Probability of Bust * Return of Stock A) + (Probability of Bust * Return of Stock B) + (Probability of Bust * Return of Stock C)
Expected return = (0.65 * 0.23) + (0.65 * 0.20) + (0.65 * 0.14) + (0.35 * 0.01) + (0.35 * 0.05) + (0.35 * 0.27)
= 0.1495
Therefore, the expected return on an equally weighted portfolio of these three stocks is 0.1495 (rounded to 4 decimal places).
To calculate the expected return of a portfolio, we need to consider the weights of each stock. The weights can be calculated by dividing the investment in each stock by the total investment amount:
Weight of Stock A = Investment in Stock A / Total Investment
= $13,200 / ($13,200 + $9,400 + $14,500)
= 0.3993
Weight of Stock B = Investment in Stock B / Total Investment
= $9,400 / ($13,200 + $9,400 + $14,500)
= 0.2834
Weight of Stock C = Investment in Stock C / Total Investment
= $14,500 / ($13,200 + $9,400 + $14,500)
= 0.3173
Now, we can calculate the expected return of the portfolio by taking the weighted average of the expected returns of each stock:
Expected return = (Weight of Stock A * Return of Stock A) + (Weight of Stock B * Return of Stock B) + (Weight of Stock C * Return of Stock C)
Expected return = (0.3993 * 0.10) + (0.2834 * 0.15) + (0.3173 * 0.28)
= 0.1867
Therefore, the expected return of the portfolio is 0.1867 (rounded to 4 decimal places).
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With reference to a project that you are familiar with, explain
any four (4) strategies that have been applied to realise the
project management objectives of cost, quality and time. (8
marks)
In a project management context, four strategies that can be applied to achieve cost, quality, and time objectives are: 1) Effective Project Planning and Scheduling, 2) Resource Optimization, 3) Risk Management, and 4) Stakeholder Communication and Collaboration.
1) Effective Project Planning and Scheduling: Thorough project planning and scheduling help in defining project objectives, activities, and timelines. By breaking down the project into smaller tasks and setting realistic deadlines, the project team can ensure efficient resource allocation and minimize delays. Utilizing project management methodologies such as the Critical Path Method (CPM) or Agile approaches can aid in effective planning and scheduling.
2) Resource Optimization: Proper resource management is crucial to control project costs and ensure quality outcomes within the given time frame. This strategy involves identifying and allocating resources (such as personnel, equipment, and materials) efficiently. By optimizing resource utilization and avoiding overallocation or underutilization, projects can stay on budget, maintain quality standards, and meet deadlines.
3) Risk Management: Implementing a robust risk management strategy is essential to address potential threats and uncertainties that can impact cost, quality, and time objectives. This strategy involves identifying and assessing project risks, developing contingency plans, and actively monitoring and mitigating risks throughout the project lifecycle. By proactively managing risks, the project team can minimize the likelihood and impact of disruptions.
4) Stakeholder Communication and Collaboration: Effective communication and collaboration with project stakeholders, including clients, team members, and suppliers, play a significant role in achieving project objectives. Regular and transparent communication helps manage expectations, resolve issues promptly, and maintain alignment among all stakeholders. Collaboration ensures that everyone is working towards the same goals, facilitating timely decision-making and problem-solving.
By implementing these strategies, project managers can enhance their ability to achieve cost, quality, and time objectives. However, it is important to note that the specific strategies and their effectiveness may vary depending on the nature and complexity of the project.
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You are the Head of Production for a large food manufacturer with operations in Australia and New Zealand. The company is renowned for providing healthy food products. After years of poor profits, the new CEO, Alex Lee, started her job with the overriding goal of raising company profitability. In an effort to cut the cost of supplies, the Head of Procurement, Paul Jones, wants to buy supplies from a different, cheaper supplier. You can appreciate his point of view, but you are concerned that cheaper supplies would lower product quality. When you bring this concern to Alex, she says she wants you and Paul to work things out. But her instructions are unclear. ‘Sure, cutting costs is good for profits, but we also need to be careful to maintain our reputation for product quality.’
With reference to relevant organisational behaviour literature, what is the most effective conflict-resolution style for the above scenario? (4 marks) Compare this conflict resolution style with two alternative conflict resolution styles and explain why they are not appropriate in this scenario. (6 marks)
Write 500 words.
The most effective conflict-resolution style for the scenario described would be a collaborative or integrative style. This approach allows the Head of Production and the Head of Procurement to work together to address concerns about cost-cutting and product quality by engaging in open communication, problem-solving, and finding mutually beneficial solutions.
Alternative conflict resolution styles such as competing and avoiding would not be appropriate in this scenario as they may result in a win-lose situation or the avoidance of underlying issues. The most effective conflict-resolution style for the given scenario is a collaborative or integrative style. This approach encourages open communication, active listening, and a problem-solving mindset. In this case, the Head of Production and the Head of Procurement need to work together to find a solution that balances the goal of cutting costs with the need to maintain product quality.
Using a collaborative style would involve both individuals sharing their concerns, interests, and perspectives. The Head of Production can express the importance of maintaining product quality to uphold the company's reputation, while the Head of Procurement can present the financial benefits of sourcing cheaper supplies. Through open and respectful dialogue, they can identify potential alternatives or compromises that address both concerns.
For example, they could explore options such as negotiating with the current supplier for better prices, conducting thorough quality assessments of potential new suppliers, or exploring other cost-saving measures in different areas of the business that do not directly impact product quality. By actively involving both parties in problem-solving, a collaborative approach helps to build understanding, trust, and a sense of shared responsibility for finding the best solution.
In contrast, two alternative conflict resolution styles, competing and avoiding, would not be appropriate in this scenario. A competing style involves pursuing one's own interests at the expense of others, which could lead to a win-lose situation where either cost-cutting or product quality becomes the sole focus. This could result in resentment or dissatisfaction from the side whose interests are not prioritized.
Similarly, an avoiding style, where the conflict is ignored or postponed, would not address the underlying concerns and could lead to unresolved issues and ongoing tensions between the Head of Production and the Head of Procurement. Avoiding the conflict would not provide a satisfactory solution to the profitability and product quality challenges the company is facing.
In contrast, a collaborative style encourages active engagement, respect for differing perspectives, and the pursuit of mutually beneficial outcomes. It allows both individuals to work together to find a solution that meets the CEO's goal of raising profitability while safeguarding the company's reputation for product quality. By taking a collaborative approach, the Head of Production and the Head of Procurement can build a stronger working relationship and contribute to the overall success of the organization.
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Lear Inc. has $800,000 in current assets, $350,000 of which are considered permanent current assets. In addition, the firm has $600.000 Invested in capital assets. a. Lear wishes to finance all capital assets and half of its permanent current assets with long-term financing costing 10 mm term financing currently costs 5 percent. Lear's earnings before Interest and taxes are $200,000. Determine Lear's earnings under this financing plan. The tax rate 1= 30 percent. Earnings after taxes b. As an alternative. Lear might wish to finance all capital assets and permanent current assets plus half of its temporary current assets with long-term financing. The same interest rates apply as in part a. Earnings before interest and taxes will be $200,000. What will be Lear's earnings after taxes? The tax rate is 30 percent. Earnings after taxes c. This part of the question is not part of your Connect assignment. tax
Under the financing plan, Lear's earnings after taxes would be $115,500, and with the alternative financing plan, Lear's earnings after taxes would be $105,000.
In the given scenario, Lear Inc. has two financing options: one where it finances capital assets and half of permanent current assets with long-term financing, and the other where it finances capital assets, permanent current assets, and half of temporary current assets with long-term financing.
Under the first financing plan, the earnings before interest and taxes (EBIT) of $200,000 will be reduced by interest expense of $35,000 (5% of $700,000) and then taxed at a 30% rate, resulting in earnings after taxes of $115,500.
Under the alternative financing plan, the EBIT of $200,000 will be reduced by interest expense of $50,000 (5% of $1,000,000) and then taxed at a 30% rate, resulting in earnings after taxes of $105,000.
The difference in earnings after taxes between the two financing plans is $10,500. This indicates that the choice of financing plan can have a significant impact on the company's profitability. It is important for Lear Inc. to carefully evaluate the financing options and consider the trade-offs between interest expense and tax implications in order to make an informed decision that maximizes its earnings.
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If a business acquired a $250,000 loan to buy a new warehouse, it would be recorded on a Cash Flow statement as Select one: OA. A decrease in cash flow from financing activities OB. An increase in cash flow from investing activities OC. An increase in the cash flow from financing activities OD. A decrease in cash flow from operating activities OE A decrease in cash flow from investing activities
If a business acquired a $250,000 loan to buy a new warehouse, it would be recorded on a Cash Flow statement as OC. An increase in the cash flow from financing activities.
The acquisition of a loan to purchase a new warehouse is considered a financing activity because it involves obtaining external financing to support the business's operations and investments. In this case, the loan proceeds increase the cash inflows from financing activities because it represents an inflow of cash from an external source (the lender).
Cash flows from financing activities on the Cash Flow statement include activities related to raising and repaying capital, such as issuing or repurchasing stock, taking on or repaying loans, and payment of dividends. The acquisition of a loan falls under the category of financing activities because it involves the inflow of funds from external sources to finance the purchase of a capital asset (the new warehouse).
It's important to accurately categorize cash flows in the statement to provide a clear understanding of the sources and uses of cash within the business.
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1-Which resource category would include the CEO of General Motors? Labor Capital Entrepreneurial Skill Land 2- Which of the following is NOT one of the 5 fundamental Ideas of Economics? Equally Beneficial Trade Tradeoffs Incentives Scarcity 3- In Economics, the MARGIN refers to the last one, Marginal Revenue being the revenue from selling the last unit, for example True False 4- Economics does not utilize the Scientific Method. True False
1- The resource category that would include the CEO of General Motors is Entrepreneurial Skill.
The CEO of a company is responsible for providing leadership, making strategic decisions, and managing the overall operations of the organization, which falls under the category of entrepreneurial skills.
2- Equally Beneficial Trade is NOT one of the 5 fundamental Ideas of Economics. The five fundamental ideas of economics are Scarcity, Tradeoffs, Incentives, Opportunity Cost, and Marginal Analysis. Equally Beneficial Trade is not one of the core concepts.
3- False. In economics, the term "margin" refers to the additional or incremental change resulting from a decision. Marginal revenue, for example, refers to the revenue generated from selling one additional unit of a product. It focuses on the change at the margin rather than the total revenue.
4- False. Economics does utilize the scientific method. It employs various scientific approaches, including observation, hypothesis formulation, data collection, analysis, and testing. Economists use empirical evidence and mathematical models to study economic phenomena and make predictions. The scientific method is an essential aspect of conducting economic research and analysis.
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.Use the spreadsheet to help format the answer please!
1. Ahmed and Ali are partners in a small business. Their partnership agreement states that net income is divided based on annual salaries of $40 000 for Ahmed and $50 000 for Ali, and an income ratio of 3:2. Calculate the net income allocation and record the journal entry, based on the following unrelated situations:
(a) net income of $200 000
(b) net loss of $8 000.
To calculate the net income allocation for Ahmed and Ali based on the given partnership agreement, we need to determine their respective shares.
Ahmed's share = Annual salary + (Income ratio * Net income)
Ali's share = Annual salary + (Income ratio * Net income)
(a) Net income of $200,000:
Ahmed's share = $40,000 + (3/5 * $200,000) = $40,000 + $120,000 = $160,000
Ali's share = $50,000 + (2/5 * $200,000) = $50,000 + $80,000 = $130,000
The journal entry to allocate the net income would be:
Income Summary $200,000
Ahmed's Capital $160,000
Ali's Capital $130,000
(b) Net loss of $8,000:
Ahmed's share = $40,000 + (3/5 * -$8,000) = $40,000 - $4,800 = $35,200 (negative value indicating loss)
Ali's share = $50,000 + (2/5 * -$8,000) = $50,000 - $3,200 = $46,800 (negative value indicating loss)
The journal entry to allocate the net loss would be:
Income Summary $8,000
Ahmed's Capital $35,200
Ali's Capital $46,800
Please note that the amounts calculated are based on the given information and the partnership agreement.
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Valley Company’s adjusted account balances from its general ledger on August 31, its fiscal year-end, follows. It categorizes the following accounts as selling expenses: sales salaries expense, rent expense—selling space, store supplies expense, and advertising expense. It categorizes the remaining expenses as general and administrative.
Adjusted Account Balances Debit Credit
Merchandise inventory (ending) $ 41,000
Other (non-inventory) assets 130,400
Total liabilities $ 25,000
K. Valley, Capital 104,550
K. Valley, Withdrawals 8,000
Sales 225,600
Sales discounts 2,250
Sales returns and allowances 12,000
Cost of goods sold 74,500
Sales salaries expense 32,000
Rent expense—Selling space 8,000
Store supplies expense 1,500
Advertising expense 13,000
Office salaries expense 28,500
Rent expense—Office space 3,600
Office supplies expense 400
Totals $ 355,150 $ 355,150
Beginning merchandise inventory was $25,400. Supplementary records of merchandising activities for the year ended August 31 reveal the following itemized costs.
Invoice cost of merchandise purchases $ 92,000
Purchases discounts received 2,000
Purchases returns and allowances 4,500
Costs of transportation-in 4,600
Required:
1. Compute the company’s net sales for the year.
2. Compute the company’s total cost of merchandise purchased for the year.
3. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses.
4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.
5. Prepare closing entries as of August 31 (the perpetual inventory system is used)
Compute net sales, total cost of merchandise purchased, prepare multiple-step and single-step income statements, and make closing entries for Valley Company.
1. Compute the company’s net sales for the year.Net sales refer to the revenue earned by the company after deducting sales discounts and sales returns and allowances.Net Sales = Sales – Sales Discounts – Sales Returns and AllowancesNet Sales = $225,600 – $2,250 – $12,000 = $211,3502. Compute the company’s total cost of merchandise purchased for the year.Cost of merchandise purchased is the sum of invoice cost of merchandise purchases, purchases discounts received, purchases returns and allowances, and costs of transportation-in.Cost of merchandise purchased = Invoice cost of merchandise purchases – Purchases discounts received – Purchases returns and allowances + Costs of transportation-inCost of merchandise purchased = $92,000 – $2,000 – $4,500 + $4,600Cost of merchandise purchased = $89,1003. Prepare a multiple-step income statement that includes separate categories for net sales, cost of goods sold, selling expenses, and general and administrative expenses.The format for a multiple-step income statement is as follows:Valley CompanyIncome StatementFor the Year Ended August 31, 20XXNet Sales $211,350
Cost of Goods Sold
Beginning Inventory $ 25,400
Purchases 89,100
Cost of Goods Available for Sale $114,500
Ending Inventory (41,000)
Cost of Goods Sold $ 73,500
Gross Profit $137,850
Selling Expenses
Sales Salaries Expense $32,000
Rent Expense – Selling Space 8,000
Store Supplies Expense 1,500
Advertising Expense 13,000
Total Selling Expenses $54,500
General and Administrative Expenses
Office Salaries Expense $28,500
Rent Expense – Office Space 3,600
Office Supplies Expense 400
Total General and Administrative Expenses $32,500
Total Operating Expenses $87,000
Operating Income $ 50,850
4. Prepare a single-step income statement that includes these expense categories: cost of goods sold, selling expenses, and general and administrative expenses.The format for a single-step income statement is as follows:Valley CompanyIncome StatementFor the Year Ended August 31, 20XXRevenue $211,350
Cost of Goods Sold $73,500
Gross Profit $137,850
Operating Expenses
Selling Expenses $54,500
General and Administrative Expenses 32,500
Total Operating Expenses $87,000
Operating Income $50,850
5. Prepare closing entries as of August 31 (the perpetual inventory system is used)Closing entries are prepared to close the temporary accounts (revenue, expense, and withdrawal accounts) to the permanent account (capital account). The journal entry to close the revenue accounts is as follows:Aug. 31 Sales $225,600
Sales Discounts $2,250
Sales Returns and Allowances 12,000
Income Summary $ 211,350
(To close the revenue accounts)The journal entry to close the expense accounts is as follows:Aug. 31 Income Summary $87,000
Sales Salaries Expense $32,000
Rent Expense – Selling Space 8,000
Store Supplies Expense 1,500
Advertising Expense 13,000
Office Salaries Expense 28,500
Rent Expense – Office Space 3,600
Office Supplies Expense 400
(To close the expense accounts)The journal entry to close the Income Summary to the capital account is as follows:Aug. 31 Income Summary $ 50,850
K. Valley, Capital $ 50,850
(To close Income Summary to K. Valley, Capital)
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You have forecast the economic activity for next year and estimate the following probabilities:
- having a boom next year is 20.0%
- having a stable economy is 55.0%
- having a recession is 25.0%.
You also forecast the price of Carbon Metals shares to be the following:
- $45 if there is a boom
- $25 if the economy is stable
- $15 if there is a recession.
What is the expected return on Carbon Metals if it is currently selling for $24 per share?
Question 29 options:
a)–9.43%
b)18.06%
c)26.50%
d)10.42%
The expected return on Carbon Metals, if it is currently selling for $24 per share, is approximately 10.42%.
To calculate the expected return on Carbon Metals, we need to multiply the possible returns by their respective probabilities and sum them up.
The expected return can be calculated as follows:
Expected Return = (Probability of Boom * Return in Boom) + (Probability of Stable Economy * Return in Stable Economy) + (Probability of Recession * Return in Recession)
Let's plug in the given values:
Expected Return = (0.20 * ($45 - $24)) + (0.55 * ($25 - $24)) + (0.25 * ($15 - $24))
Expected Return = (0.20 * $21) + (0.55 * $1) + (0.25 * -$9)
Expected Return = $4.20 + $0.55 - $2.25
Expected Return = $2.50
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However, instead of protecting against every possible cause of loss, property insurance policies generally restrict their protection to carefully specified causes of loss and specifically exclude caus
Property insurance policies generally restrict their protection to carefully specified causes of loss and specifically exclude causes of loss that are not mentioned in the policy.
Property insurance provides coverage for the loss or damage of property. It is crucial for homeowners, renters, and businesses to have property insurance to protect their assets in case of theft, fire, or other unforeseen events.However, instead of protecting against every possible cause of loss, property insurance policies generally restrict their protection to carefully specified causes of loss and specifically exclude causes of loss that are not mentioned in the policy. These exclusions can include intentional acts, acts of war, acts of government, and natural disasters. For example, if a property owner does not purchase flood insurance and their property is damaged in a flood, the property insurance policy will not cover the damages. It is important to carefully read and understand the terms and exclusions of a property insurance policy to ensure that you have the coverage you need.
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The theory that focuses on improving the performance of individual workers is known as ______________________________.
a. classical management
b. administrative management
c. scientific management
The theory that focuses on improving the performance of individual workers is known as scientific management.
Scientific management is a theory that focuses on improving the performance of individual workers. Frederick Winslow Taylor, an American mechanical engineer, developed the concept of scientific management, which aimed to improve efficiency by breaking down each task into small, simple components and identifying the most efficient methods of performing them. Taylor's main objective was to increase productivity and efficiency by eliminating waste and increasing output. The scientific management method includes determining the best way to perform a job, selecting and training workers, and providing incentives to motivate workers. Managers employ this approach to improve work processes and reduce waste in the production process. The approach focuses on how work is done, with the aim of improving efficiency, productivity, and profitability of a business organization . Scientific management is a concept that has greatly impacted management studies, and many organizations continue to apply it in their daily operations to achieve high performance and profitability.
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