The economic order quantity (EOQ) for the SKU can be calculated as 279 units. When the inventory level reaches this point, the firm should initiate a replenishment order to minimize inventory costs while meeting customer demand. To maintain a cycle-service level of 96%, a reorder point of 238 units should be set.
1. The firm should place orders when the inventory level reaches this point. To calculate the economic order quantity (EOQ), we use the formula EOQ = √(2DS/H), where D is the annual demand, S is the ordering cost per order, and H is the holding cost per unit per year. Substituting the given values, we have EOQ = √(2 * 19600 * 35 / 3.75) ≈ 279 units.
2. To determine the reorder point, we need to consider the lead time and the desired cycle-service level. Since the lead time is 1 week and the firm operates 52 weeks per year, the average demand during the lead time is 19600/52 = 377 units. To achieve a cycle-service level of 96%, we need to set the reorder point at the level where there is only a 4% chance of stockout during lead time. Using the standard normal table, the z-value corresponding to a 4% chance is -1.75. Therefore, the reorder point is 377 - (-1.75 * √(98)) ≈ 238 units.
3. In summary, the firm should place orders for the SKU using an economic order quantity of 279 units. To maintain a cycle-service level of 96%, the reorder point should be set at 238 units. When the inventory level reaches this point, the firm should initiate a replenishment order to minimize inventory costs while meeting customer demand.
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Diamond Foods Payments to Nut Growers
The leadership of Diamond Foods (DF), the global California-based premium snack food company, was excited. In the fall of 2011, the company was close to finalizing an agreement with Proctor & Gamble to acquire Pringles brand in exchange for DF stock, this acquisition would help the company achieve the number two position in the U.S. snack foods industry behind PepsiCo. DF product lines currently included potatoes chips (Kettle), popcorn (Pop-Secret), and (nuts) snack nuts, in-shell nuts and culinary nuts) Emerald and Diamond of California). DF started in 1912 as a grower-owned cooperative called Diamond of California. The company originally focused on walnuts, but more recently they transformed into a diverse snack food company. The business changed from a co-operative business status and went public in 2005 with the NASDAQ ticker DMND. The stock price increased, and in September 2011, the price was at an all-time high of $92 per share.
The person who orchestrated the company’s expansion and growth was CEO and President Michael Mendes, who was hired in 1997. He had previously worked at Hormel Foods Corporation and Dole Food Company. Mendez was very competitive and implemented the companywide philosophy of "bigger is better". This viewpoint was the corporate culture, and it had a significant impact on employees of DF. This aggressive company culture resulted in an emphasis on financial performance and some bold and very expensive acquisitions (e.g., Kettle and Pop-Secret). The most expensive acquisition was to be Pringles. DF was making this acquisition, so it could be a significant player in the very competitive snack foods space where it felt pressure for financial success and greater market share amid increasing industry competition.
In Fall of 2011, Mark Roberts, founder of the Off-Wall Street Consulting Group, received an anonymous call. For the fiscal year ending in July 2011, the caller indicated that DF was making ‘momentum payments’ to growers for walnuts delivered in September 2011. It appears that the approximately $60 million payments could be impacting the wrong fiscal year financial statements. Robert accused DF of incorrectly reporting its payments to suppliers on the company financial statements. DF denied any illegal actions, and they replied that the payments were on advance on the fiscal 2012 crop and had nothing to do with fiscal 2011. Unfortunately, the nut growers disagreed. They were told by the company to keep the money even if they were not going to provide crops for 2012. Supposedly, they were told that the payments were for the prior year.
Investigation into the situation ascertained that an additional approximately $20 million of ‘continuity payments’ were made by DF growers in fall 2010. Again, the question arose as to what fiscal year did these payments relate. Were the payments recorded in the proper year? Were the books cooked? Would the Pringles acquisition occur?
There are many accounting rules that may apply in this case. Discuss the rules that you believe may apply.
In what fiscal periods should fall 2010 and fall 2011 payments have been recorded in the DF income statements?
When was the cash paid to the growers? Was it a different period than when the payments were recorded?
How were the financial statements impacted in 2010 and 2011?
2. Were there any other things happening in the company that could have had a part in this?
3. How was this case of fraud found? Who found it? What are some steps that could have been taken that may have prevented this? What changes did this company make in order to prevent this from occurring again?
4. In the end, was the Pringles line acquired?
The accounting rules that may apply in this case include revenue recognition, accrual accounting, and the matching principle.
The fall 2010 and fall 2011 payments should have been recorded in the income statements of the corresponding fiscal periods when the services were provided or the goods were delivered. The cash paid to the growers may have occurred in a different period than when the payments were recorded. The financial statements of DF in 2010 and 2011 were likely impacted by the incorrect recording of payments, potentially leading to misstated financial results.
The case of fraud was discovered through an anonymous call to Mark Roberts, who raised concerns about the payments. Steps that could have been taken to prevent this include implementing stronger internal controls, conducting regular audits, and ensuring compliance with accounting principles. To prevent similar incidents, the company may have made changes such as improving financial oversight, enhancing transparency, and tightening the process for recording payments.
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Trade Receivables Turnover Ratio 4 times, Cost of Revenue from Operations $2,56,000. Gross Profit on
Revenue from operations 20%, Closing Trade Receivables were $8,000 more than at beginning.
Cash
Revenue from operations being 33-1/3 % of Credit Revenue from operations. Find out the amount of
Opening and Closing Trade Receivables.
Given data are Trade Receivables Turnover Ratio 4 times Cost of Revenue from Operations [tex]$2,56,000[/tex] ,Gross Profit on Revenue from operations 20%Closing Trade Receivables were[tex]$8,000[/tex] more than at the beginning Cash Revenue from operations being[tex]33-1/3 %[/tex]of Credit Revenue from operations.
let's calculate the Credit Revenue from operations.
[tex]Credit Revenue from operations = Revenue from operations/33.33% = Revenue from operations × 3/100 = Credit Revenue from operations× = Credit Revenue from operations × 100/3Revenue from operations = 256000Credit Revenue from operations = (256000×3)/100 = 7680[/tex].
the amount of Trade Receivables. Opening Trade Receivables Turnover Ratio = Credit Revenue from operations / Average Trade Receivables
4 = 7680 / (Opening Trade Receivables + Closing Trade Receivables)/2
Opening Trade Receivables + Closing Trade Receivables = [tex]7680×2/4 + 8000 = 13680[/tex]
Opening Trade Receivables = [tex]x Closing Trade Receivables = x + 8000[/tex]
we have[tex]2x + 8000 = 13680 = > 2x = 13680 - 8000 = 5680= > x = 2840[/tex]Opening Trade Receivables = [tex]$2840[/tex]
Closing Trade Receivables = [tex]$10840[/tex].
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.currently have 179,000 in a bond account. You plan to add $6,100 per year at the end of the next 10 years to your bond account. the bond account will earn a return 7.75 percent the next ten years so how much will you have when you retire?
You are planning your retirement in 10 years. You currently have $179,000 in a bond account You plan to add $6.300 per year at the end of each of the next 10 years to your bond account. The bond account wit eam a retum of 275 percent in each of the next 10 years. How much will you have when you retire? Do not round immediate calculations and round your final answers to 2 decinal places.
To calculate the total amount you will have when you retire, we can use the future value of an ordinary annuity formula.
Given:
Present value (initial amount in the bond account) = $179,000
Annual deposit into the bond account = $6,100
Number of years = 10
Interest rate per year = 7.75%
Using the future value of an ordinary annuity formula:
FV = P * [(1 + r)^n - 1] / r
Where:
FV = Future value
P = Annual deposit
r = Interest rate per year
n = Number of years
Calculating the future value of the annuity:
FV = $6,100 * [(1 + 0.0775)^10 - 1] / 0.0775
= $6,100 * (1.0775^10 - 1) / 0.0775
≈ $91,107.21
Adding the initial amount in the bond account:
Total amount when you retire = $179,000 + $91,107.21
≈ $270,107.21
Therefore, when you retire in 10 years, you can expect to have approximately $270,107.21 in your bond account.
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Exercise 2. Suppose the only three risky assets in the market have the following expected returns and standard deviations: Asset A Asset B Asset C Expected returns 12.5% 15.0% 25.0% Standard deviation
The degree of variance or dispersion in a group of values is measured statistically by the standard deviation. It reveals the degree to which the data points deviate from the mean (average) value.
Given the following expected returns and standard deviations: Asset A Asset B Asset C Expected returns 12.5% 15.0% 25.0% Standard deviation For this case, we have the following mathematical formula that represents the calculation of the expected return:
E(Rp) = w1R1 + w2R2 + w3R3
where E(Rp) = expected return on a portfolio w1 = proportion of the portfolio invested in asset 1 R1 = expected return of asset 1 w2 = proportion of the portfolio invested in asset 2 R2 = expected return of asset 2 w3 = proportion of the portfolio invested in asset 3 R3 = expected return of asset 3.
Using the provided formula, let us find the portfolio expected returns (E(Rp)) below: For Asset A: E(Rp) = w1R1 + w2R2 + w3R3E(Rp) = (0.25 * 0.125) + (0.5 * 0.15) + (0.25 * 0.25)E(Rp) = 0.03125 + 0.075 + 0.0625E(Rp) = 0.16875For Asset B: E(Rp) = w1R1 + w2R2 + w3R3E(Rp) = (0.25 * 0.125) + (0.5 * 0.15) + (0.25 * 0.25)E(Rp) = 0.03125 + 0.075 + 0.0625E(Rp) = 0.16875For Asset C: E(Rp) = w1R1 + w2R2 + w3R3E(Rp) = (0.25 * 0.125) + (0.5 * 0.15) + (0.25 * 0.25)E(Rp) = 0.03125 + 0.075 + 0.0625E(Rp) = 0.16875.
Hence, the expected return for all the risky assets is 16.875%.
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Workers Production of Beef 1 5000 2 9500 3 12602 4 M Assume the MPL of the 4th worker is 1178. What is the value of "M" in the table?
Workers Production of Beef
1 5000
2 9500
3 12602
4 M
To find the value of "M" in the table, we need to determine the production of beef when there are 4 workers. The marginal product of the 4th worker is given as 1178.
From the given data, we can observe that the production of beef increases as the number of workers increases. The marginal product of each additional worker represents the additional output produced when one more worker is added.
Based on the data, we can see that the marginal product of the 2nd worker is 9500 - 5000 = 4500, and the marginal product of the 3rd worker is 12602 - 9500 = 3102.
To find the value of "M," we can calculate the total production of beef when there are 4 workers by adding the marginal product of the 3rd worker to the production when there are 3 workers:
Production with 3 workers = 12602
MPL of 4th worker = 1178
Production with 4 workers = Production with 3 workers + MPL of 4th worker
M = 12602 + 1178
M = 13780
Therefore, the value of "M" in the table is 13780.
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the yield to maturity of a bond is the discount rate that makes the present value of the coupon and principal payments
The yield to maturity (YTM) of a bond is the discount rate that equates the present value of all future cash flows from the bond to its current market price.
In other words, it is the rate of return an investor would earn if they held the bond until it matures and received all the promised payments.
To calculate the yield to maturity, you would need to use an iterative process or financial calculator. The formula for calculating the present value of a bond's cash flows involves discounting each cash flow by the YTM. By adjusting the YTM until the present value of the cash flows equals the bond's market price, you can determine the yield to maturity.
The YTM takes into account the time value of money and the risk associated with the bond's cash flows. It represents the average annual return an investor would earn if they purchased the bond at its current market price and held it until maturity.
It's important to note that the yield to maturity assumes that all coupon payments are reinvested at the YTM rate and that the bond is held until maturity.
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1.
Name three ways to link HR strategy to business strategy. (150
words minimum)
The human resource strategy must align with the overall business strategy to increase the organization's efficiency and effectiveness. The HR strategy must cater to the workforce and ensure that their needs and goals align with the organization's objectives.
Here are three ways to link human resource strategy to business strategy:1. Identify the goals of the business strategy: To align HR strategy with business strategy, the HR department must know the goals and objectives of the business. HR strategy must be designed to support the business's mission and objectives. For example, if the business aims to expand into new territories, HR must hire and train new employees to support this expansion.2. Develop HR policies that align with business strategy: The policies that HR creates must support the business strategy. The HR policies must be designed to create a culture that aligns with the business's core values.
For instance, if the business aims to be environmentally friendly, HR can implement policies that focus on eco-friendly practices.3. Analyze workforce capabilities and skills: To align the HR strategy with the business strategy, HR must analyze the workforce's capabilities and skills. If the business aims to develop a new product, HR must ensure that the workforce has the right skills to achieve this goal. In conclusion, HR strategy is an essential aspect of any business strategy. The HR department plays a critical role in linking the HR strategy with the business strategy.
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Which of the following is not one of the appeals of an unrelated diversification strategy? O The potential to grow shareholder value by investing in bargain-priced or struggling companies with big upside profit potential, tuming their operations around fairly quickly with infusions of cash and managerial know-how, and then riding the crest of higher profitability O Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses O An ability to employ the company's financial resources to maximum advantage by investing in whatever industries/businesses offer the best profit prospects O A potential for achieving somewhat more stable corporate sales and profits over the course of economic upswings and downswings (to the extent the company diversifies into businesses whose ups and downs tend to occur at different times) O The ability to spread business risk over truly diverse industries (as compared to related diversification which is limited to spreading risk only among businesses with strategic fit)
The correct option is (B). Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses is not one of the appeals of an unrelated diversification strategy.
An unrelated diversification strategy refers to the creation of a new business that has nothing to do with the existing business. It implies developing or acquiring firms in different industries and with unrelated product lines, which are different from the existing business.
A diversified company is one whose business activities span a wide range of industries or product lines. This strategy helps the organization to reduce its business risk by spreading it over several industries. The various appeals of an unrelated diversification strategy are as follows:
1. Potential to grow shareholder value by investing in bargain-priced or struggling companies with significant upside profit potential.
2. Ability to employ the company's financial resources to maximum advantage by investing in whatever industries/businesses offer the best profit prospects.
3. Potential for achieving more stable corporate sales and profits over the course of economic upswings and downswings.
4. The ability to spread business risk over truly diverse industries (as compared to related diversification which is limited to spreading risk only among businesses with strategic fit).
So, the correct option is (B) Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses.
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You have been asked by the president of the Farr Construction Company to evaluate the proposed acquisition of a new earth mover. The mover's basic price is $220,000, and it would cost another $30,000 to modify it for special use. Assume that the mover falls into the MACRS 5-year class, it would be sold after 4 years for $60,000, and it would require an increase in net operating working capital (spare parts inventory) of $10,000. The earth mover would have no effect on revenues, but it is expected to save the firm $52,000 per year in before-tax operating costs, mainly labor. The firm's marginal federal-plus-state tax rate is 25 percent and the project's cost of capital is 10 percent.
Evaluate the project using the NPV rule and the IRR rule.
To evaluate the project using the NPV rule and the IRR rule, we need to calculate the net cash flows for each year, discount them to their present value, and then apply the respective rules.
First, let's calculate the net cash flows:
Year 0:
Initial investment = -$220,000 (basic price) - $30,000 (modification cost) + $10,000 (increase in working capital) = -$240,000
Years 1-4:
Net cash flow = Savings in operating costs - Tax on savings
Net cash flow = $52,000 - ($52,000 * 0.25) = $39,000 (after-tax cash flow)
Year 5:
Net cash flow = Salvage value - Tax on salvage value
Net cash flow = $60,000 - ($60,000 - $30,000) * 0.25 = $45,000 (after-tax cash flow)
Now, let's calculate the present value of the net cash flows using the project's cost of capital of 10%:
PV (Year 0) = -$240,000 / (1 + 0.10)^0 = -$240,000
PV (Years 1-4) = $39,000 / (1 + 0.10)^1 + $39,000 / (1 + 0.10)^2 + $39,000 / (1 + 0.10)^3 + $39,000 / (1 + 0.10)^4 = $134,095.04
PV (Year 5) = $45,000 / (1 + 0.10)^5 = $28,598.74
Next, let's calculate the net present value (NPV) by summing up the present values of the net cash flows:
NPV = PV (Year 0) + PV (Years 1-4) + PV (Year 5) = -$240,000 + $134,095.04 + $28,598.74 = -$77,306.22
To evaluate the project using the IRR rule, we can use a financial calculator or spreadsheet to find the internal rate of return (IRR). The IRR is the discount rate that makes the NPV of the project equal to zero.
Using a financial calculator or spreadsheet, the IRR for this project is approximately 8.92%.
Based on the NPV rule, since the NPV is negative (-$77,306.22), the project would be considered unattractive. It does not generate sufficient returns to cover the initial investment and provide a positive net present value.
Based on the IRR rule, the project's IRR of 8.92% is lower than the cost of capital (10%). Therefore, the project would also be considered unattractive using the IRR rule.
Overall, based on both the NPV rule and the IRR rule, the proposed acquisition of the new earth mover would not be recommended.
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Please show all work in excel! will upvote once both answred thank you!
You are offered an annuity that will pay you 10,000 at the end of each year for 20 years, with the first payment being in 10 years from today. If the interest rate is 12% annually, what is this annuity worth to you today?
26,935.56
24,100.55
200,000
64,394.55
74,694.44
Your company is considering a project with the following cash flows.
year cashflow
0 -800
1 5000
2 200
3 -5000
Assuming the cost of capital is 10%, first internal rate of return?
7.46%
7.51%
8.20%
0%
9.54%
The annuity is worth approximately $26,935.56. The project has a first IRR of approximately 7.46% with cash flows of -$800, $5,000, $200, and -$5,000 over four years at a cost of capital of 10%.
The explanation of the calculations for excel sheet is
Annuity Calculation
To calculate the present value of an annuity, we can use the formula:
PV = C * [(1 - (1 + r)⁻ⁿ) / r],
where PV is the present value, C is the cash flow per period, r is the interest rate per period, and n is the number of periods.
Using the given information:
C = $10,000 (cash flow per year),
r = 12% (interest rate), and
n = 20 (number of years).
Using the formula, we can calculate the present value (annuity worth) as follows:
PV = $10,000 * [(1 - (1 + 0.12)^(-20)) / 0.12]
PV ≈ $26935.56
Therefore, the annuity is worth approximately $26,935.56 today.
Internal Rate of Return (IRR) Calculation
To calculate the internal rate of return (IRR), we need to find the discount rate that makes the net present value (NPV) of the cash flows equal to zero. We can use the IRR function in Excel to find the IRR.
Using the cash flows given:
Year 0: -$800
Year 1: $5,000
Year 2: $200
Year 3: -$5,000
In Excel, you can use the following formula to calculate the IRR:
=IRR(B1:B4),
where B1:B4 represents the range of cash flows.
Using this formula, the first internal rate of return is approximately 7.46%.
Therefore, the first internal rate of return for the project is approximately 7.46%.
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Why not because If they decide to pursue a non-asset based growth strategy, then they will only be able to acquire smaller companies with great products but lack a lot of resources.
Should the Wheels Group pursue a non-asset-based growth strategy or an asset-based strategy? Why or why not?
This would be beneficial for both the acquiring firm and the acquired firm since it would give them access to many more resources than either firm would have access too on their own.
It's urgent
The decision of whether the Wheels Group should pursue a non-asset-based growth strategy or an asset-based strategy depends on various factors.
If the company has limited resources but wants to acquire smaller firms with great products, a non-asset-based strategy may be suitable. This approach allows the Wheels Group to leverage the strengths and innovations of the acquired firms without the need for significant investments in physical assets. It can provide access to new markets and technologies while minimizing upfront costs.
However, if the Wheels Group has the financial means and wants more control over the supply chain, an asset-based strategy could be considered. Acquiring companies with substantial assets can provide economies of scale and operational efficiencies.
Ultimately, the decision should align with the company's long-term goals, market opportunities, and competitive landscape. Conducting a thorough analysis and seeking expert advice can help determine the most appropriate growth strategy for the Wheels Group.
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The following tables show the production possibilities frontier for Fiji and Canada. Using this information make the following calculations: Canada's Production Possibilities Tomatoes (tons) 10,000 and 0 7500 and 2,500 5000 and 5,000 2500 and 7,500 0 and 10,000 Mexico's Production Possibilities Tomatoes (tons) Wheat (tons) 100,000 and 0 75000 and 250 5:00 50000 and 25000 and O and 750 1,000 a. Opportunity Cost of Tomatoes in Canada & Mexico b. Opportunity Cost of Wheat in Canada & Mexico Wheat(tons) c. Suppose Canada & Mexico specialize in only producing what they are best at making. Calculate the total amount of wheat & tomatoes produced by the two countries under this scenario.
The total amount of wheat and tomatoes produced by the two countries under this scenario is 25,000 and 100,000 respectively.
Given tables show the production possibilities frontier for Fiji and Canada.Canada's Production Possibilities Tomatoes (tons) 10,000 and 0 7500 and 2,500 5000 and 5,000 2500 and 7,500 0 and 10,000
Mexico's Production Possibilities Tomatoes (tons) Wheat (tons) 100,000 and 0 75000 and 25000 50000 and 25000 25000 and 50000 0 and 100,000
a. Opportunity Cost of Tomatoes in Canada & Mexico, the opportunity cost of tomatoes in Canada & Mexico is as follows:
Canada's Opportunity Cost of Tomatoes (OC_C)OC_C = Δ Wheat/Δ Tomatoes= (25000 – 0) / (7500 – 0)= 25000 / 7500= 3.33
Mexico's Opportunity Cost of Tomatoes (OC_M)OC_M = Δ Wheat/Δ Tomatoes= (25000 – 0) / (100000 – 0)= 25000 / 100000= 0.25
b. Opportunity Cost of Wheat in Canada & Mexico:Canada's Opportunity Cost of Wheat (OC_C)OC_C = Δ Tomatoes/Δ Wheat= (7500 – 0) / (25000 – 0)= 7500 / 25000= 0.3
Mexico's Opportunity Cost of Wheat (OC_M)OC_M = Δ Tomatoes/Δ Wheat= (100000 – 0) / (25000 – 0)= 100000 / 25000= 4
c. Suppose Canada & Mexico specialize in only producing what they are best at making. Calculate the total amount of wheat & tomatoes produced by the two countries under this scenario
.We can determine the total amount of wheat and tomatoes produced by the two countries by comparing their opportunity costs. Canada should specialize in producing wheat while Mexico should specialize in producing tomatoes because they have lower opportunity costs for these goods.
This would lead to the following specialization: Canada specializes in producing Wheat Mexico specializes in producing TomatoesAs, given data, Canada's Production Possibilities are:
Tomatoes (tons) 10,000 and 0 7500 and 2,500 5000 and 5,000 2500 and 7,500 0 and 10,000
Here, Canada's best specialty is Wheat which is produced at (25000, 0).
So, the amount of wheat produced is 25,000 tons, and the amount of tomatoes produced is 0.
Mexico's Production Possibilities are: Tomatoes (tons) Wheat (tons) 100,000 and 0 75000 and 25000 50000 and 25000 25000 and 50000 0 and 100,000
Here, Mexico's best specialty is Tomatoes which are produced at (0, 100,000). So, the amount of tomatoes produced is 100,000 tons, and the amount of wheat produced is 0.
Hence, the total amount of wheat and tomatoes produced by the two countries under this scenario would be:
Total amount of wheat = 25,000
Total amount of tomatoes = 100,000
Therefore, the total amount of wheat and tomatoes produced by the two countries under this scenario is 25,000 and 100,000 respectively.
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Wildhorse Company purchased a delivery truck for $40,000 on July 1, 2022. The truck has an expected salvage value of $4,000, and is expected to be driven 100,000 miles over its estimated useful life of 8 years. Actual miles driven were 15,000 in 2022 and 12,000 in 2023. Wildhorse uses the straight-line method of depreciation. (a) Your answer is partially correct. Compute depreciation expense for 2022 and 2023. Depreciation Expense 2022 2023 Straight-line method $ $ $ 4500 Prepare the journal entry to record 2022 depreciation. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit Prepare the journal entry to record 2023 depreciation. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit Show how the truck would be reported in the December 31, 2023, balance sheet. WILDHORSE COMPANY Partial Balance Sheet
To calculate the depreciation expense for 2022 and 2023, we will use the straight-line method:
(a) Depreciation Expense for 2022:
Depreciation Expense 2022 = ($40,000 - $4,000) / 8
(b) Depreciation Expense for 2023:
Depreciation Expense 2023 = ($40,000 - $4,000) / 8
Now let's prepare the journal entries for recording the depreciation expense:
(a) Journal entry to record 2022 depreciation:
Date: December 31, 2022
Account Titles and Explanation Debit Credit
Depreciation Expense $4,500
Accumulated Depreciation - Truck $4,500
(Record the depreciation expense for 2022)
(b) Journal entry to record 2023 depreciation:
Date: December 31, 2023
WILDHORSE COMPANY
Partial Balance Sheet
As of December 31, 2023
Asset:
Truck $31,000
Less: Accumulated Depreciation ($4,500)
Net Truck $26,500
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1. Suppose the reserve ratio requirement is 30% and there is an increase in bank excess reserves of $50 million a. Calculate the money multiplier. Show your work. b. What is the total amount of additional deposits created by this initial increase in bank excess reserves? Show your work. c. Explain based on your calculations in part b the meaning of the money multiplier d Suppose the Federal Reserve decreases the reserve ratio to 20%. Calculate the new money multiplier and show your work. Explain why the money multiplier increased or decrease as a result of the higher reserve ratio.
The reserve ratio decreases, the amount of excess reserves held by the bank increases, which, in turn, leads to an increase in the money supply generated by each dollar of the bank's excess reserves.
a) Calculation of Money Multiplier in the given scenario: Here, the reserve ratio requirement is 30%, and the bank has an excess reserve of $50 million.
So, it can be calculated as follows :Money multiplier = 1 / reserve ratio Money multiplier = 1 / 0.3Money multiplier = 3.33Therefore, the money multiplier is 3.33.
b) Calculation of the total amount of additional deposits created by this initial increase in bank excess reserves: The total amount of additional deposits created by this initial increase in bank excess reserves is the product of the money multiplier and the excess reserves of banks.
Total additional deposits created = Money multiplier x Excess reserves Total additional deposits created = 3.33 x $50 million Total additional deposits created = $166.5 million Therefore, the total amount of additional deposits created by this initial increase in bank excess reserves is $166.5 million.
c) Explanation of the meaning of the money multiplier based on calculations in part b:From the above calculations, it can be interpreted that the money multiplier determines the amount of money supply generated by each dollar of the bank's excess reserves. The value of the money multiplier in this scenario is 3.33, which means that the bank can create $3.33 of deposits from each dollar of excess reserves it has.
d) Calculation of new money multiplier and explanation of the increase or decrease in the money multiplier as a result of the higher reserve ratio: When the Federal Reserve decreases the reserve ratio to 20%, the new money multiplier can be calculated as follows: Money multiplier = 1 / reserve ratio Money multiplier = 1 / 0.2Money multiplier = 5Therefore, the new money multiplier is 5. The money multiplier increases when the reserve ratio decreases.
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Cocomelon Umbrellas can purchase a new fabric gluing/sewing machine for $100,000. The new process will
reduce variable cost by $1 per unit. Fixed costs will rise to $310,000. Should the company make this purchase?
Explain
New contribution margin = $10Since the new contribution margin is lower than the old contribution margin, Cocomelon Umbrellas should not purchase the new machine.
Cocomelon Umbrellas wants to buy a new fabric gluing/sewing machine for $100,000, which will reduce variable cost by $1 per unit. Fixed costs will increase to $310,000.
Cocomelon Umbrellas has to make a decision on whether or not to purchase a new fabric gluing/sewing machine. The new machine will cost $100,000, and it will reduce variable costs by $1 per unit. Fixed costs will increase to $310,000 if the purchase is made.The contribution margin of a product is calculated by subtracting the variable cost per unit from the selling price per unit. By reducing variable costs by $1 per unit, the contribution margin per unit will rise by $1.
Therefore, the new contribution margin per unit after the purchase would be:
Contribution margin = Selling price per unit - Variable cost per unit
Contribution margin = Selling price per unit - (Variable cost per unit - $1)
Contribution margin = Selling price per unit - Variable cost per unit + $1
Contribution margin = Old contribution margin per unit + $1
Cocomelon Umbrellas can purchase the new machine if the contribution margin is greater than the old contribution margin. Therefore, the contribution margin for the product before and after the purchase must be compared:
Old contribution margin = $12 - $3
Old contribution margin = $9
New contribution margin = $12 - $2
New contribution margin = $10
Since the new contribution margin is lower than the old contribution margin, Cocomelon Umbrellas should not purchase the new machine.
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The audit of which of the following balance sheet accounts does not normally result in verification of an income statement account?
A) Cash.
B) Accounts receivable.
C) Property, plant, and equipment.
D) Intangible assets.
The audit of balance sheet accounts such as property, plant, and equipment and intangible assets does not typically require direct verification of income statement accounts. C is correct answer
The audit of the Property, Plant, and Equipment (PPE) account does not normally result in the verification of an income statement account.
Property, plant, and equipment are long-term assets that are used in the production or supply of goods and services. These assets are not directly linked to the income statement accounts, which typically represent revenues, expenses, gains, and losses for a specific period.
The verification of the PPE account primarily focuses on ensuring that the assets exist, are owned by the company, and are accurately recorded on the balance sheet. The audit procedures for PPE involve physical inspections, review of title documents, and examination of relevant contracts or agreements. The purpose is to confirm the existence, valuation, and ownership of the assets, as well as to assess any impairment or depreciation charges.
On the other hand, income statement accounts, such as revenue, expenses, gains, and losses, are typically verified through different audit procedures. These procedures may include testing the completeness and accuracy of revenue recognition, examining supporting documents for expenses, analyzing journal entries, and assessing the appropriateness of accounting policies and estimates.
While the audit of other balance sheet accounts like cash, accounts receivable, and intangible assets may involve verification of related income statement accounts, the audit of the PPE account does not typically result in the direct verification of an income statement account.
C is correct answer
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List and briefly describe the nine broad banking services.
There are nine broad banking services that financial institutions typically provide to their customers. These services cater to various financial needs and play a crucial role in the economy .
Here's a brief description of each:
1. Deposit Services: Banks accept deposits from individuals and businesses, allowing them to securely store their money. These deposits can be in the form of savings accounts, checking accounts, or certificates of deposit (CDs).
2. Loans and Credit Services: Banks provide loans and credit to individuals and businesses, helping them finance various needs such as home purchases, education, business expansion, and more. These services often involve interest rates and repayment terms.
3. Payment Services: Banks facilitate the movement of funds through payment services, including issuing checks, electronic funds transfers (EFTs), debit cards, credit cards, and online payment systems.
4. Foreign Exchange Services: Banks offer currency exchange services, allowing customers to convert their funds between different currencies for international travel, trade, or investment purposes.
5. Investment Services: Banks provide investment products such as mutual funds, stocks, bonds, and other securities. They may also offer investment advisory services to assist customers in making informed investment decisions.
6. Asset Management Services: Banks can manage and administer assets on behalf of individuals or institutional clients. This includes services like portfolio management, estate planning, trust management, and retirement planning.
7. Insurance Services: Many banks offer insurance products such as life insurance, health insurance, property insurance, and other related services to help individuals and businesses protect their assets and manage risk.
8. Financial Advisory Services: Banks provide financial advice and consultation to clients, helping them make informed decisions regarding financial planning, wealth management, retirement planning, and other financial matters.
9. Electronic Banking Services: With the rise of technology, banks offer various electronic banking services, including online banking, mobile banking, and digital wallets. These services enable customers to access and manage their accounts conveniently.
It's important to note that while these services are commonly offered by banks, the availability and specifics may vary depending on the institution and its policies.
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↳ A Moving to another question will save this response. Question 4 These machines, descended from the battle tank will accelerate deforestation, develop suburbs and give access to natural resources: O Excavators, loaders, snowmobiles, construction cranes. Helicopters, submarines, hovercraft, gliders. lawnmowers, chainsaws, wood chippers, earth packers. Bulldozers, harvesters, logging trucks, skidders. Moving to another question will save this response Question 3 of 5 estion 3 10 points Save Ar The Anthropocene age has made an irreversible mark on the geological record of the planet due to human activity. What are the man-made factors responsible for these markers in the geological record? O Coal exploitation, atomic power, petroleum extraction. O World War 1. World War 2 and hydroelectric dams O Slavery, colonization, the assembly line and consumerism O Interstate highways, Levit homes and solar power Question 3 of 5 A Moving to another question will save this response. H Q a DELL FIG 10 E PA P12 Se whers MA Digi Tum
The term Anthropocene represents the present geological age of the Earth, which is influenced by the human activities. These activities have made an irreversible impact on the planet's geological record. The man-made factors responsible for these markers in the geological record are:Coal exploitation, atomic power, petroleum extraction are the man-made factors responsible for these markers in the geological record of the planet.
These human activities have led to the accumulation of toxic chemicals, soil depletion, climate change, and ozone depletion. Such activities have caused significant damage to the natural ecosystems and brought negative impacts on various life forms.
Human activities such as mining and oil drilling have caused disruptions to the natural water cycle, leading to water scarcity. Industrialization and transportation have also contributed to air pollution and habitat fragmentation. In conclusion, human activities have had an irreversible impact on the geological record of the planet, which requires the attention of the current generation to take action.
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.Whitman Company has just completed its first year of operations. The company's absorption costing income statement for the year appears below:
Whitman Company Income Statement Sales (39,000 units x $40.60 per unit) $1,542,800
Cost of goods sold (38,000 units x $24 per unit) 912,000
Gross margin 630,800
Selling and administrative expenses 437,000
Net operating income $193,800
The company's selling and administrative expenses consist of $285,000 per year in fixed expenses and $4 per unit sold in variable expenses. The $24 per unit product cost given above is computed as follows:
Direct materials $11
Direct labor 5
Variable manufacturing overhead 3
Fixed manufacturing overhead ($240,000 x 48,000 units) 5
Absorption costing unit product cost $24
1. Prepare the company's income statement in the contribution format using variable costing.
2. Reconcile any difference between the net operating income on your variable costing income statement and the net operating income on the absorption costing income statement.
1. Whitman Company Income Statement (Variable Costing)
Sales: (39,000 units x $40.60 per unit) $1,542,800
Variable Expenses:
- Direct materials: (39,000 units x $11 per unit) $429,000
- Direct labor: (39,000 units x $5 per unit) $195,000
- Variable manufacturing overhead: (39,000 units x $3 per unit) $117,000
- Variable selling and administrative expenses: (39,000 units x $4 per unit) $156,000
Total Variable Expenses: $897,000
Contribution Margin: $1,542,800 - $897,000 = $645,800
Fixed Expenses:
- Fixed manufacturing overhead: $240,000
- Fixed selling and administrative expenses: $285,000
Total Fixed Expenses: $525,000
Net Operating Income: $645,800 - $525,000 = $120,800
2. Reconciliation of Net Operating Income:
Absorption Costing Net Operating Income: $193,800
Variable Costing Net Operating Income: $120,800
Difference = Absorption Costing Net Operating Income - Variable Costing Net Operating Income
= $193,800 - $120,800
= $73,000
The difference of $73,000 represents the increase in net operating income under absorption costing compared to variable costing. This difference is due to the fixed manufacturing overhead being absorbed into the product cost under absorption costing. Since the company produced more units (39,000) than it sold (38,000), the fixed manufacturing overhead allocated to each unit is higher, resulting in a higher product cost and higher net operating income under absorption costing.
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Say you are an investor and are planning on selling a few bonds that you hold. When you call a bond dealer, which of the following prices will be quoted to you?
Question 3 options:
A)
Bid price
B)
Ask price
C)
Bid-Ask price
D)
Quote price
The correct option is A. When you call a bond dealer to sell bonds, the price that will be quoted to you is the "Bid price."
The Bid price is the price at which the bond dealer is willing to buy the bonds from you. It represents the highest price the dealer is willing to pay for the bonds at that moment.
The Ask price, on the other hand, represents the price at which the dealer is willing to sell the bonds to you. It is the lowest price at which the dealer is willing to sell the bonds.
The Bid-Ask spread is the difference between the Bid price and the Ask price. It reflects the dealer's profit margin and liquidity costs.
The Quote price refers to the price at which a bond is currently being traded in the market. It can be either the Bid price or the Ask price, depending on whether the transaction involves buying or selling.
In the context of selling bonds, the bond dealer will quote you the Bid price because that is the price they are willing to pay to purchase the bonds from you.
When you call a bond dealer to sell bonds, the price that will be quoted to you is the Bid price. This represents the price at which the dealer is willing to buy the bonds from you.
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You must complete the following tasks:
1. Using the KNIME platform examine Summary Statistics
2. Build Decision Tree, Logistic Regression and KNN workflows in KNIME
3. Create a validation set: Split your dataset into two parts, "Train" and "Test".
4. Train and build Classification models for your dataset
5. Evaluate and compare the Performance of your Models using the Confusion
Matrix and Determine Accuracy Rate
When you have completed tasks 1-5 above, you
In this question, you have been given 5 tasks that need to be completed. The tasks are given below:1. Using the KNIME platform, examine summary statistics2. Build Decision Tree, Logistic Regression, and KNN workflows in KNIME3. Create a validation set: Split your dataset into two parts, "Train" and "Test".4. Train and build Classification models for your dataset5.
Evaluate and compare the Performance of your Models using the Confusion Matrix and Determine the Accuracy RateTask 1 - Using the KNIME platform, examine summary statisticsThe summary statistics describe the main features of the data in a dataset. The KNIME platform provides various nodes to generate and examine summary statistics. You can use the following nodes:Descriptive Statistics node: It generates summary statistics like minimum, maximum, mean, median, standard deviation, variance, skewness, and kurtosis.
Correlation node: It generates correlation statistics between attributes in a dataset.Cross-Tabulation node: It generates the frequency distribution of categorical variables.Task 2 - Build Decision Tree, Logistic Regression, and KNN workflows in KNIMEKNIME provides various machine learning algorithms that can be used to build Decision Tree, Logistic Regression, and KNN workflows.
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Question 9
Proposition 13, enacted in 1977, reflected California voters' desire to
a. reject gun control laws
b. reduce emissions from automobiles
c. cut property taxes in the state
d. reduce funding for state universities
Question 10
By the end of the 1970s, California's financial picture was darkened due to all of the following except:
a. reduced defense spending after the end of the Vietnam war.
b. OPEC's raise in oil prices causing an "energy crisis".
c. taxpayer revolts like Prop. 13
d. a reduction in emissions from newly purchased automobiles.
The correct answer of Q9 and Q10 is (a) and (b).
Energy conservation refers to the act of conserving energy by practicing efficient energy utilization, avoiding wastage, and reducing energy use. OPEC's raise in oil prices caused an "energy crisis."
Energy conservation refers to the act of conserving energy by practicing efficient energy utilization, avoiding wastage, and reducing energy use. It is about decreasing energy consumption while still enjoying the same level of service. This can be done through various methods such as reducing energy use, lowering consumption, or using more efficient technology.OPEC's raise in oil prices caused an "energy crisis." The OPEC oil embargo of 1973 caused a global economic and political crisis that lasted until the early 1980s. This occurred when OPEC, a group of oil-producing nations, stopped selling oil to countries that supported Israel in the Yom Kippur War, causing prices to skyrocket and energy supplies to be reduced worldwide. The increase in oil prices caused inflation, a decline in economic growth, and a decrease in the standard of living. As a result, many people began to seek ways to conserve energy and reduce consumption to avoid high energy costs. This led to the development of more energy-efficient products, such as cars, appliances, and lighting, and the implementation of energy-saving measures. These efforts resulted in a more sustainable and efficient use of energy and a reduction in dependence on fossil fuels, reducing the effects of the energy crisis in the long run.The reduction in emissions from newly purchased automobiles is another way to reduce energy consumption. This can be achieved by using electric cars, hybrid cars, or fuel-efficient cars that use less gasoline and produce fewer emissions. These cars use advanced technologies such as regenerative braking, which converts the car's kinetic energy into electricity and stores it in the battery. This reduces the amount of energy required to power the car and reduces emissions. Additionally, many countries have implemented emissions standards for vehicles to reduce the amount of pollutants released into the environment, which has resulted in cleaner air and a healthier environment.For such more questions on environment
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Choose a FALSE statement regarding the t-distribution.
O The t distribution is based on the assumption that the population of interest is normal nearly normal.
O The t distribution has a greater spread than does the z distribution. As a result, the critical values of t for a given level of significance are larger in magnitude than the corresponding z critical values.
O There is not one t distribution, but rather a "family" of t distributions. All t distributions have a mean of zero and a standard deviation of 1.
O The higher the degree of confidence, the larger the sample required to give a certain precision.
The false statement regarding the t-distribution is: "The t distribution has a greater spread than does the z distribution. As a result, the critical values of t for a given level of significance are larger in magnitude than the corresponding z critical values."
The t distribution actually has a greater spread than the standard normal distribution (z distribution). This means that the critical values of t for a given level of significance are larger in magnitude than the corresponding z critical values. In other words, the tails of the t distribution are fatter than the tails of the standard normal distribution, which accounts for the larger critical values.
The t distribution is a family of distributions, and not all t distributions have a mean of zero and a standard deviation of 1. The shape of the t distribution depends on the degrees of freedom, which is determined by the sample size. As the sample size increases, the t distribution approaches the standard normal distribution.
The statement about the relationship between the degree of confidence and sample size is generally true. As the degree of confidence increases, the precision or level of certainty desired also increases. To achieve a higher degree of confidence, a larger sample size is typically required to provide more reliable and accurate results.
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In your role working as a paralegal or legal assistant for
eHarbour, draft a memorandum to Daniel Hudson, the eHarbour general
counsel, on how best to protect eHarbour’s intellectual property.
Speci
Word LS311_M1_Assignment_Template v B. Accessibility Mode Download MEMORANDUM Date: [today's date] To: Daniel Hudson From: (student name] Re: Protecting eHarbour Intellectual Property Introduction [Pr
MEMORANDUM Date: [Today's date]To: Daniel HudsonFrom: (Your Name)Re: Protecting eHarbour's Intellectual Property Introduction Intellectual property refers to original ideas, inventions, and creative work, whether in literary, artistic, or scientific fields.
It is crucial that eHarbour has adequate protections in place to safeguard the company's intellectual property. In this memorandum, I will provide recommendations for how best to protect eHarbour's intellectual property.BodyIt is critical that eHarbour has a comprehensive Intellectual Property (IP) strategy in place. The IP strategy should include a range of measures to ensure that eHarbour is adequately protected from a variety of risks. The following recommendations should be taken into consideration by eHarbour to safeguard its intellectual property:Patent filing: eHarbour should file patents to protect its innovative technology. Patents are a legal mechanism that provides eHarbour exclusive rights to their invention. This will safeguard the company's innovation and help eHarbour maintain its competitive edge.Trademark Registration: Trademarks are a significant part of a company's IP and should be registered to protect its brand and corporate image. Trademark infringement could cause significant financial losses and damage to eHarbour's reputation. Thus, all eHarbour trademarks should be registered to avoid any future litigation.Copyright registration: Copyright protection should be given to all original creative works produced by eHarbour. Copyright is granted automatically to an original work when it is created. However, to enforce copyright, the work must be registered with the relevant authority. By registering its creative works, eHarbour will prevent others from copying or distributing its creative work.Trade secrets: Trade secrets protection is essential to safeguard eHarbour's confidential information. Thus, eHarbour should have measures in place to prevent unauthorized access to confidential information by its employees or other third parties.ConclusionIn conclusion, it is crucial that eHarbour has a comprehensive IP strategy in place to safeguard the company's intellectual property. Patent filings, trademark registration, copyright registration, and trade secrets protection are among the measures that should be included in eHarbour's IP strategy. Implementing these recommendations will help eHarbour maintain its competitive edge and prevent others from exploiting its intellectual property.
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Standardization of documents is the main focus of: O Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) O Islamic Financial Services Board (IFSB) O International Islamic Financial Market (IFM) O International Islamic Rating Agency (IIRA)
The main focus of standardization of documents lies with the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI).
The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) is an international organization that plays a significant role in setting standards for Islamic finance. One of its primary objectives is the standardization of documents used in Islamic financial transactions.
AAOIFI develops and issues accounting, auditing, and governance standards for Islamic financial institutions. These standards cover a wide range of areas, including financial reporting, investment, risk management, and Shariah compliance. By standardizing documents and practices, AAOIFI aims to enhance transparency, consistency, and comparability within the Islamic finance industry.
The organization's standards are widely recognized and followed by Islamic financial institutions globally. They provide guidance on the preparation of financial statements, the classification and valuation of assets and liabilities, and the treatment of specific Islamic financial instruments. Standardization facilitates better understanding, improves investor confidence, and promotes harmonization across different jurisdictions.
While other organizations such as the Islamic Financial Services Board (IFSB), International Islamic Financial Market (IIFM), and International Islamic Rating Agency (IIRA) also contribute to the development and regulation of Islamic finance, the main focus on standardization of documents lies with AAOIFI.
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Unexplained answers will NOT be graded An economist has estimated the demand equation of a certain product as Q-200-5P where P is the price unit and Qis the quantity demanded in th 1.Calculate the own price elasticity of demand of the product when its price goes from $30 to $35 per unit. 2. Give an interpretation of the value of the own price elasticity calculated in question 1. 3. Using the demand equation Q-200-5P, calculate the own price elasticity when price is P-$10. Is demand elastic, unit-elastic or inelasticat price 4. Using the demand equation Q-200-5P, determine the consumer surplus (CS) when price is P-$10. What's the total expenditure (TE) when pric when price is P=$10. ALT+F10 (PC) or ALT+FN+F10 (Mac).
1. The own price elasticity of demand is -5.
2. The negative own price elasticity indicates price elastic demand.
3. Insufficient information to determine the own price elasticity at $10 price.
4. The consumer surplus is $750, and the total expenditure cannot be determined without quantity information.
1. The own price elasticity of demand can be calculated using the formula: Elasticity = (% change in quantity demanded) / (% change in price). In this case, the price increases from $30 to $35, resulting in a 16.67% change. Plugging the values into the formula, the own price elasticity is -5.
2. The negative value of the own price elasticity (-5) indicates that the product has a price elastic demand. This means that a 1% increase in price will lead to a 5% decrease in quantity demanded. The product is considered to be price-sensitive, and consumers are responsive to changes in price.
3. Substituting the price value of $10 into the demand equation Q = 200 - 5P, we find that the quantity demanded is Q = 200 - 5(10) = 150 units. To calculate our own price elasticity, we need to know the percentage change in quantity demanded and the percentage change in price, which are not provided. Without this information, we cannot determine whether the demand is elastic, unit-elastic, or inelastic at this price.
4. To determine the consumer surplus (CS) when the price is $10, we need to find the area under the demand curve above the price level. Using the demand equation Q = 200 - 5P, when P = $10, the quantity demanded is Q = 200 - 5(10) = 150 units. The consumer surplus can be calculated as CS = (1/2) x (150) x (10) = $750. However, the total expenditure (TE) when the price is $10 cannot be determined without knowing the quantity demanded at that price.
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Hassan's income increases and, as a result, he buys more fish. Is fish an inferior or a normal good? Why? What happens to Hassan's demand curve for fish? Explain. Over the past 30 years, technological advances have reduced the cost of computer chips. How do you think this has affected the market for computers? And the market for typewriters? Explain.
Fish is likely a normal good for Hassan because as his income increases, he buys more of it. The demand curve for fish would shift to the right, indicating an increase in demand, as Hassan's higher income allows him to purchase more fish.
Fish being a normal good for Hassan implies that it is a product for which demand increases as income rises. This suggests that fish is considered a desirable and higher-quality product that people are willing to consume more of when they have more purchasing power. As Hassan's income increases, he has more disposable income available to spend on various goods, including fish. Consequently, he chooses to buy more fish, indicating that it is a normal good for him.
In terms of the demand curve for fish, the increase in Hassan's income would cause a rightward shift in the curve. This means that at each price level, Hassan is now willing and able to buy more fish compared to his previous income level. The shift reflects an increase in demand for fish, as higher income enables him to afford and consume a greater quantity of fish. The entire demand curve would shift, indicating a change in the relationship between the price of fish and the quantity demanded by Hassan. The extent of the shift depends on the income elasticity of demand for fish, which measures the responsiveness of quantity demanded to changes in income.
Regarding technological advances in computer chips, they have had a significant impact on the market for computers. These advancements have led to increased efficiency, improved performance, and reduced production costs for computer manufacturers. As a result, the market for computers has experienced increased supply, lower prices, and higher demand.
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Due to the severity of COVID 19 on households, the government of Australia announced Job Keeper Allowances to be given to the labour force that had lost employment. a. Examine the impact of Job Keeper Allowances during the COVID 19 recession on Australia's economy
The Job Keeper Allowances implemented by the government of Australia during the COVID-19 recession had a significant impact on the country's economy.
The Job Keeper Allowances played a crucial role in providing support to the labor force that had lost employment due to the pandemic. By providing financial assistance to affected individuals, the government aimed to mitigate the economic impact of the recession and prevent a more severe downturn.
During the COVID-19 recession, many businesses faced closures and layoffs, leading to a sharp increase in unemployment rates. The Job Keeper Allowances helped to stabilize household incomes and maintain consumer spending to some extent. This financial support provided a lifeline for individuals and their families, reducing the adverse effects of unemployment on their well-being and living standards. It also helped to prevent a larger decline in aggregate demand, supporting businesses and preventing a more severe contraction in economic activity. By supporting the labor force and maintaining household incomes, the Job Keeper Allowances played a crucial role in cushioning the negative impact of the recession and aiding the overall recovery process.
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The management of company has presented their fixed assets in the current assets. As an auditor you have to test the presentation and disclosure of the fixed assets. Determine the most applicable audit objective for the test. Select one: O A. Classification O B. Cut-off O C. Existence OD. Right and obligation Clear my choice Determine the main source of evidence to be used in the substantive test Select one: A. Journal listing B. Payment Vouchers Fixed Asset Register Fixed Asset Ledger O C. O D. Which test is predominantly used in auditing fixed assets? Select one: O A. Substantive test O B. Risk assessment O C. Test of control O D. Scanning Auditors establish the validity of Fixed Assets Register by the following actions except for ......... Select one: O A. Test check the additions and disposal B. Perform analytical procedures O C. Check the casting in the PPE register O D. Agree the total cost of PPE in the general ledger with that of the PPE register Auditors select a sample of PPE from physical inspection and trace them to the Fixed Assets Register. Determine the audit objective for the procedure, which is performed by the auditors. Select one: O A. Right an obligation O B. Existence O C. Valuation D. Completeness
The most applicable audit objective for testing the presentation and disclosure of the fixed assets is Existence. The purpose of this procedure is to establish that the fixed assets exist, are owned by the entity, and are included in the Fixed Asset Register.
The for this is that the existence objective is used to test whether the assets or liabilities exist at the balance sheet date. The auditor needs to verify that the fixed assets presented in the current assets exist and are owned by the entity. This objective is used to establish that the company's financial statements include all assets and liabilities that should be recorded and that these assets are the company's property.The main source of evidence to be used in the substantive test is the Fixed Asset Register. The Fixed Asset Register is the source document that provides information about each fixed asset owned by the company. It shows the acquisition cost, accumulated depreciation, and the net book value of each asset.
The auditor will need to test the accuracy and completeness of the Fixed Asset Register to ensure that it includes all the fixed assets owned by the company.The Substantive test is predominantly used in auditing fixed assets. This test involves gathering evidence from different sources to support the amounts and disclosures in the financial statements. It is used to detect material misstatements in the financial statements, which could arise from fraud or error. Auditors will use substantive tests to obtain evidence about the completeness, accuracy, and validity of the fixed assets register.Auditors establish the validity of Fixed Assets Register by performing analytical procedures, test check the additions and disposal, and agree the total cost of PPE in the general ledger with that of the PPE register. However, they do not check the casting in the PPE register because that is not an effective way to establish the validity of the fixed assets register.The audit objective for the procedure that auditors use to select a sample of PPE from physical inspection and trace them to the Fixed Assets Register is Existence.
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Diana and Jim enter into a written contract under which Diana will sell Jim some of her rare comic books for $300. The contract contains a list of each comic book that is supposed to be part of the sale. The contract states that it contains the complete and final agreement reached by Diana and Jim. When Jim receives the comics, he is upset to find out that Diana did not include a particular Superman comic. He sues Diana, stating that even though the written contract does not mention that particular Superman issue, he and Diana had orally agreed, just before the contract was written, that she would include the Superman in the deal. Jim wants to submit evidence of their prior oral agreement. Diana argues that such evidence would violate the parol evidence rule. 1. Does this contract have the necessary element of consideration (Chapter 14)? 2. If so, discuss the benefit received by each party and the detriment suffered by each party? In other words, what is each party receiving and what is each party given up? 3. Is this contract enforceable or would it be illegal or violate public policy to enforce this contract (Chapter 15)? 4. Is this the type of contract that falls within the Statute of Frauds (Chapter 16)? 5. Will Jim be allowed to introduce parol evidence to show the party's prior oral agreement before the contract was made (Chapter 16)?
The contract between Diana and Jim involves the sale of rare comic books for $300. Jim claims an oral agreement for a particular Superman comic, while Diana argues against admitting parol evidence violating the parol evidence rule.
The contract has consideration as Jim pays $300 for the rare comic books, benefiting him with the acquisition and Diana with the payment.
This contract appears enforceable, without indications of illegality or violation of public policy.
It is advisable to check the specific jurisdiction's laws regarding the Statute of Frauds, as contracts for the sale of goods over a certain value may require a written agreement.
Jim may be allowed to introduce parol evidence if it falls within an exception to the parol evidence rule, such as proving fraud, mistake, or ambiguity. The admissibility of parol evidence would depend on the specific jurisdiction's laws and applicable case law.
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