Answer:
$23,500
Explanation:
The average accounting rate of return is the rate of return on the investment in the project considering the average annual net income and the average amount of investment made in the project.
In other words, it is the average annual net income expressed as a percentage of the average investment as shown below
average accounting rate of return =average annual net income / average investment.
average investment=(initial capital outlay+book value of the project at end of useful life)/2
initial capital outlay=$47,000
book value of the project at end of useful life=$0
average investment=($47,000+$0)/2
average investment=$23,500
A project has an expected risky cash flow of $500 in year 3. The risk-free rate is 4%, the expected market rate of return is 14%, and the project's beta is 1.20. Calculate the certainty equivalent cash flow for year 3, CEQ3. (Assume CAPM holds.)
The certainty equivalent cash flow for year 3, CEQ3 is $360.33
The computation of the certainty equivalent cash flow for year 3 is as follows:
But before that, the cost of equity should be determined via using the Capital Asset Pricing Model (CAPM).
Cost of equity = Risk-free rate + beta × (expected market rate of return - risk-free rate)
= 4% + 1.20 × (14% - 4%)
= 16%
Now the certainty equivalent cash flow for year 3 is
= $500 ÷ (1+ 0.16)^3
= $360.33
Therefore we can conclude that the certainty equivalent cash flow for year 3, CEQ3 is $360.33
Learn more about the CAPM here: brainly.com/question/14531617
Discuss the importance of innovation in the survival and success of a business. Include three strategies that you, as an entrepreneur, can use to encourage creativity and innovation in your small business in your response. Provide support for your response.
Answer is given below :
Explanation:
Innovation is part of the business and should be successful in the long run. If the business is not innovative it will one day fail and stop making a profit. example shows that it was the number one mobile phone in 2000 but it failed for a long time because it did not change the dynamic market and did not adopt the Android operating system.There are three strategies to promote creativity and innovation in small business: -A business should focus not only on the product, but also on the process, delivery and customer service of the product.A business must always come up with new ideas to survive in the market, which will reduce costs and improve production.A business must constantly monitor the current dynamic environment in the business world and adapt to market conditions and change business on time if necessary.A firm with earnings before interest and taxes of $500,000 needs $1 million of additional funds. If it issues debt, the bonds will mature after 20 years and pay interest of 8 percent. The firm could issue preferred stock with a dividend rate of 8 percent. The firm has 100,000 shares of common stock outstanding and is in the 30 percent income tax bracket. What are the (1) earnings per common share under the two alternatives, (2) the times-interest-earned if the firm uses debt financing, and (3) the times-dividend-earned if the firm uses preferred stock financing
Answer:
Calculation of Earning Per Share
Particulars Debt Alternative($) Preferred Stock($)
Amount Required 1,000,000 1,000,000
Earning before Interest and Tax 500,000 500,000
Less: Interest Cost(8%) 80,000 ----
Earning After Interest 420,000 500,000
Tax(30%) 126,000 150,000
Earning After Tax 294,000 350,000
Less: Dividend to Pref. Shares 80,000
Earning Avai. for C. Stockholders 294,000 270,000
Outstanding shares 100,000 100,000
Earning Per Common Share 2.94 2.70
2. Times Interest Earned Ratio = EBIT / Interest
Times Interest Earned Ratio = 500,000 / 80,000
Times Interest Earned Ratio = 6.25 Times
3. Times Dividend Earned Ratio = Net Income / Preferred Dividend
Times Dividend Earned Ratio = 350,000 / 80,000
Times Dividend Earned Ratio = 4.375 Times
Hollywood Construction Company recognizes revenue over time according to percentage of completion for its long-term construction contracts. During 2018, Hollywood began work on a $3,000,000 fixed-fee construction contract, which was completed in 2021. The accounting records disclosed the following data at year-end:
Cumulative contract costs incurred Estimated costs to complete at end of year
2018 $200,000 $1800,000
2019 $1100,000 1100,000
2020 2,000,000 4,00,000
For the 2020 year, Hollywood should have recognized gross profit on this contract of :___________
Answer:
Recognized gross profit on this contract for the 2020 year = $100,000
Explanation:
Note: See the attached excel file for the Calculation of Recognized Gross Profit on this contract for the 2020 year (in bold red color).
In the attached excel file, Recognized Gross Profit for Each Year is calculated using the following formula:
Recognized Gross Profit = Revenue for Current Period - Actual Cost Incurred
From the attached excel file, we have:
Recognized gross profit on this contract for the 2020 year = $100,000
Grapefruit, Inc. provides the following information for 20X8: Net income $39,000 Market price per share of common stock $20/share Dividends paid $0.75/share Common stock outstanding at Jan. 1, 2018 110,000 shares Common stock outstanding at Dec. 31, 2018 155,000 shares The company has no preferred stock outstanding. Calculate the dividend yield for common stock.
Answer: 3.75%
Explanation:
Dividend yield = Annual dividend / Common stock market price
Annual dividend = 0.75 per share
Common stock market price = $20 per share
Dividend yield = 0.75 / 20
= 3.75%
Which statement does not describe a difference between government and household budgets? In the short term, economists would expect the budget deficits and surpluses to fluctuate up and down with the economy and the automatic stabilizers. Most economists view the proposals for a perpetually balanced budget with bemusement. Most economists agree with the proposals for a perpetually balanced budget. Economic recessions should automatically lead to larger budget deficits or smaller budget surpluses, while economic booms lead to smaller deficits or larger surpluses.
Answer:
Most economists view the proposals for a perpetually balanced budget with bemusement
Explanation:
A balanced budget is a budget where at the end of every year, revenue must equal expenditure. this type of budget can magnify the business cycle. This types of budget contrasts with a cyclically balanced budget
A Cyclically balanced budget is when in a recession, the government makes use of expansionary fiscal policy and in a boom, the government makes use of a contractionary fiscal policy to stabilise the economy. So, in a recession, deficits would be higher and in an expansion, surplus would be higher.
Government sector deficit occurs when government spending exceeds income of the government.
When deficit increases, debt increases. This is because a deficit would need to be funded by additional borrowing
When there is a surplus, government spending is less than the income of the government.
The Zeller Corporation's stockholders' equity accounts have the following balances as of December 31, 2016:
Common stock, $10 par (30,000 shares issued and outstanding) $300,000
Additional paid-in capital 2,000,000
Retained earnings 5,700,000
Total stockholders' equity $8,000,000
Refer to above table. On January 2, 2017, the board of directors of Zeller declared a 5% stock dividend to be distributed on January 31, 2017. The market price per share of Zeller's common stock was $30 on January 2 and $32 on January 31. As a result of this stock dividend, the retained earnings account should be decreased by :___________
Answer:
The Zeller Corporation
As a result of this stock dividend, the retained earnings account should be decreased by :___________
$15,000.
Explanation:
a) Data and Calculations:
The Zeller Corporation's stockholders' equity accounts have the following balances as of December 31, 2016:
Common stock, $10 par (30,000 shares issued and outstanding) $300,000
Additional paid-in capital 2,000,000
Retained earnings 5,700,000
Total stockholders' equity $8,000,000
Analysis:
January 2, 2017: Stock dividend $15,000 (30,000 * 5% = 1,500 shares * $10) Stock dividend distributable $15,000
January 31, 2017: Retained Earnings $15,000 Stock Dividend $15,000
Stock dividend distributable $15,000 Common stock $15,000
On December 31, Jacoby Company's Prepaid Rent account had a balance before adjustment of $6,000. Three months' rent was paid in advance on December 1, the first day of the lease term. The adjusting entry needed on December 31 is:
Answer:
Debit Rent Expense $2,000; credit Prepaid Rent $2,000.
Explanation:
Assuming On December 31, the Company's Prepaid Rent account had a balance before adjustment of the amount of $6,000 which means that if the Three months' rent was paid in advance on December 1, The adjusting entry needed on December 31 is:
Debit Rent Expense $2,000
Credit Prepaid Rent $2,000.
($6000/3month)
(To record Rent Expense)
Integrity Accounting Firm provides various financial services to organizations. Integrity has decided to price its jobs at the total variable costs of the job plus 14.3 percent. The job for a medium-sized dance club client included the following costs:
Direct materials $20,000
Direct labor (partners and staff accountants) 150,000
Depreciation (using straight-line method) on
Integrity’s office building 50,000
Required:
Calculate the price charged by The J. Escobar Law Firm to the dance club.
Answer:
$194,310
Explanation:
The price charged by The J. Escobar Law Firm to the dance club is as follows:
Direct Materials $20,000
Direct Labour $150,000
Total Variable Cost of Jobs $170,000
14.3% Mark up on TVC $24,310
The price charged ro the club $194,310
Which of the following statements is true?
a. Overhead can be applied slowly as a job is worked on.
b. Overhead can be applied when the job is completed.
c. Overhead should be applied to any job not completed at year-end in order to properly value the work in process inventory.
Answer:
the answer should be
a. Overhead can be applied slowly as a job is worked on.
Answer:
A: overhead can be applied slowly as a job is worked on.
Explanation:
Im pretty sure i already learned that! so trust it!
hope it helps!
if its wrong report my answer!
John House has taken a 20-year, $250,000 mortgage on his house at an interest rate of 6 percent per year. What is the remaining balance (or value) of the mortgage after the payment of the fifth annual installment?
Answer:
$211,689. 53
Explanation:
Calculation to determine the remaining balance (or value) of the mortgage after the payment of the fifth annual installment
Step 1 is to compute PMT using Financial calculator
I = 6%
N = 20
PV = 250,000
FV = 0
PMT=?
Hence,
PMT = 21,796.14.
Now let determine the PV using Financial calculator
I = 6%
N = 15
PMT = 21,796.14
PV=?
Hence,
PV = $211,689. 53
Therefore the remaining balance (or value) of the mortgage after the payment of the fifth annual installment is $211,689. 53
An individual taxpayer reports the following items for the current year: Ordinary income from Partnership A, operating a movie theater in which the taxpayer materially participates $70,000 Net loss from Partnership B, operating an equipment rental business in which the taxpayer does not materially participate (9,000) Rental income from building rented to a third party 7,000 Short-term capital gain from sale of stock 4,000 What is the taxpayer’s adjusted gross income for the year?
Answer:
$74,000
Explanation:
Calculation to determine the taxpayer’s adjusted gross income for the year
Taxpayer’s adjusted gross income=Net loss from Partnership B+Capital gain from sale of stock
Let plug in the formula
Taxpayer’s adjusted gross income=$70,000+ $4,000
Taxpayer’s adjusted gross income=$74,000
Therefore the taxpayer’s adjusted gross income for the year is $74,000
Bonita Industries uses flexible budgets. At normal capacity of 21000 units, budgeted manufacturing overhead is $168000 variable and $360000 fixed. If Bonita had actual overhead costs of $546000 for 26000 units produced, what is the difference between actual and budgeted costs
Answer:
$22,000 Favorable
Explanation:
The computation of the difference between actual and budgeted cost is given below:
Budgeted Variable Manufacturing Overhead Per Unit is
= $168,000 ÷ 21,000 units
= $8
The Fixed Overhead = $360,000
Now
For 26,000 Units, total Overhead Should be:
Variable = 26,000 × 8 = $208,000
Fixed = $360,000
Total = $568,000
And,
Actual Overhead Cost = $546,000
So,
Difference between Actual and Budgeted Cost is
= $568,000 - $546,000
= $22,000 Favorable
If the market index subsequently rises by 8% and Ford’s stock price rises by 7%, what is the abnormal change in Ford’s stock price? (Negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 1 decimal place.)
Answer:
-1.9%.
Explanation:
The computation of the abnormal change in the stock price of ford should be given below:
Given that
The return on the market is 8%.
So, the forecast monthly return for Ford is
= 0.10% + (1.1 × 8%)
= 8.9%.
And, the Ford’s actual return was 7%,
So,
the abnormal return be
= 7% - 8.9%
= -1.9%.
In 4-6 sentences, discuss how understanding the concept of price elasticity of demand is useful for a business owner/firm operating in any market structure. Copying the definition or restating the definition of elasticity will result in loss of points. (What does price elasticity of demand tell the firm in terms
Answer:
The concept of price elasticity is important to a firm because it would help a firm determine how to change prices in order to increase total revenue
For example, if a firm has an elastic demand, if price is increased, the quantity demanded would fall. The fall in demand would be greater than the increase in price. As a result, total revenue would fall. If price is reduced, the quantity demanded would increase.. the increase in demand would be greater than the reduction in price. Total revenue would increase
If on the other hand, demand is inelastic, if price is increased, total revenue increases. If price is reduced, total revenue reduces
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.
Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one
Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.
Infinitely elastic demand is perfectly elastic demand. Demand falls to zero when price increases
Perfectly inelastic demand is demand where there is no change in the quantity demanded regardless of changes in price.
How does Spotify implement Salesforce?
Any answer is very appreciated^^!!
Explanation:
With Salesforce, Spotify has continued to offer amazing customer service since its days as a small startup. The company started by using Desk.com for fast customer support and later migrated to an integrated Sales Cloud and Service Cloud system for a customised solution with 360-degree customer views and collaboration.
Research on the increasing rate of teenage pregnancy with research methods
Answer:
Ghana constitute to record high rate of Ap.Recent national report shows that 11percent of adolescent age 15 to 19 had had a live birth of which 3 percent with first child and 14 percent has began childbearing
The direct method of reporting operating cash flows: ________
a. Separately lists cash receipts and payments.
b. Must be used by all companies.
c. Is used by most companies.
d. Is considered supplementary disclosure.
e. Is not recommended by the FASB, but is commonly used.
Answer:
e. Is not recommended by the FASB, but is commonly used.
Explanation:
A statement of cash flows is also known as cash flow statement and it is a financial statement which is used to illustrate how changes in income and various account of the balance sheet affect cash and cash equivalents.
The statement of cash flows is also used by financial experts or accountants to breakdown the cash-flow analysis into;
1. Cash-flow from investing activities: it represents the cash flow from investment such as proceeds from the sale of plant, equipments etc.
2. Cash-flow from financing activities: it represents the cash flow from debt or equity. Typically, it's the costs used in a financing a business.
3. Cash-flow from operating activities: it represents cash-flow and transactions from operational business activities such as employee salary, sales of goods etc.
Generally, the statement of cash flows provides financial information about an organization's operating profitability and how it use its operating cash flow.
Financial accounting standards board (FASB) is a private, non-profit organization saddled with the responsibility of establishing and maintaining financial accounting and reporting standards for general guidance of individuals or capital providers such as investors, issuers and auditors.
In Financial accounting, the direct method of reporting operating cash flows uses actual cash inflows and outflows from the operating activities of a company by generating data from the income statement (cash receipts and cash disbursements/payments).
However, the direct method of reporting operating cash flows is not recommended by the FASB, but it's commonly used.
This ultimately implies that, it's a recommended accounting method, but it's not an accounting standard required by the financial accounting standards board (FASB).
Mavs Inc. wishes to determine its cost of common stock equity, rs. The market price, P0, of its common stock is $40.07 per share. The firm expects to pay a dividend, D1, of $4.20 at the end of the coming year, 2021. The dividends paid on the outstanding stock over the past 6 years (2015â2020) were as follows:
2015 $3.60
2016 3.65
2017 3.70
2018 3.85
2019 4.00
2020 4.10
What is the cost of common stock equity financing?
Answer:
13.12%
Explanation:
Using the Gordon growth rate model, the cost of common stock equity can be determined using the formula below:
cost of common equity=expected dividend/current market price+growth rate
expected dividend=dividend in a year's time=D1= $4.20
current market price=P0=$40.07
The growth rate of the dividend can be ascertained by using the future value below:
FV=PV*(1+g)^n
FV=2020 dividend=$4.10
PV=2015 dividend=$3.60
g=growth rate=unknown
n=numbr of years between 2015 and 2020=5(dividend has grown for only 5 years not 6 years)
$4.10=$3.60*(1+g)^5
$4.10/$3.60=(1+g)^5
$4.10/$3.60 can be rewritten thus($4.10/$3.60)^1
($4.10/$3.60)^1=(1+g)^5
divide indexes on both sides by 5
($4.10/$3.60)^(1/5)=1+g
g=($4.10/$3.60)^(1/5)-1
g=2.64%
cost of common equity=($4.20/$40.07)+2.64%
cost of common equity=13.12%
Commercial banks, savings and loan associations, and credit unions: Group of answer choices deposit their excess funds with the U.S. Treasury. accept deposits and make loans. specialize solely in loaning money for home mortgages.
Answer:
accept deposits and make loans.
Explanation:
Credit union is a form of financial institution owned by members of the union. The union provides financial services similar to the services provided by commercial banks
A commercial bank is a financial institution that accepts deposits from customers, provide loans to customers and provide financial products t costumers. Only commercial banks. deposit their excess funds with the U.S. Treasury.
A savings and loan associations is a financial institution that specializes in helping customers get residential mortgages.
The characteristic that these three financial institutions share is that they accept deposits and make loans
most expensive startup option is usually A. starting a business from scratch B. buying a franchise C. buying an established business D. renting a building
C. buying an established business
If you look at it it kind of depends on the business and their success rates.
The seven main functions of marketing summarize what it takes to _____.
Explanation:
The seven functions of marketing are distribution, market research, setting prices, finance, product management, promotional channels and matching products to consumers
I guess this may help
Answer:
All of the above
Explanation:
just took it
Freya and her team resolved several problems and came up with some great techniques during their latest project. What should they do to help improve the performance of future projects?
They should do identifying and documenting the lessons that are learned for improving out the performance of upcoming projects
The performance of the upcoming projects should depend upon the following information:
Return on investment.Cost of quality.Cost performance.Cycle time of the project.ProductivityPlanning the strategy, identifying it, analyzed it, and executed it.These above factors should be for the performance
So in order to improve the performance of the upcoming projects. we should do the identification and documenting the lessons that are learned.
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The rate at which revenue was generated (in millions of dollars per year) for a certain company for the years 2010 through 2016 can be approximated by f(t)=348e0.22t (10≤t≤16), where t=10 corresponds to the start of the year 2010. Find and interpret ∫1016f(t)dt.
The revenue of a company represents the income generated by the company within a time frame. The total revenue generated by the company from the start of 2010 to the start of 2016 is $39.16 billion
Given that:
[tex]f(t) = 348e^{0.22t}[/tex] [tex]10 \le t \le 16[/tex]
First, we calculate the integral
[tex]\int\limits^{16}_{10} {f(t)} \, dt[/tex]
This is calculated as:
[tex]\int\limits^{16}_{10} {f(t)} \, dt = \int\limits^{16}_{10} {348e^{0.22t}} \, dt[/tex]
Remove the constant
[tex]\int\limits^{16}_{10} {f(t)} \, dt = 348\int\limits^{16}_{10} {e^{0.22t}} \, dt[/tex]
Now, integrate
[tex]\int\limits^{16}_{10} {f(t)} \, dt = 348 \times \frac{1}{0.22} (e^{0.22t})|\limits^{16}_{10}[/tex]
[tex]\int\limits^{16}_{10} {f(t)} \, dt = \frac{ 348}{0.22} (e^{0.22t})|\limits^{16}_{10}[/tex]
Expand
[tex]\int\limits^{16}_{10} {f(t)} \, dt = \frac{ 348}{0.22} (e^{0.22\times 16} -e^{0.22\times 10} )[/tex]
[tex]\int\limits^{16}_{10} {f(t)} \, dt = \frac{ 348}{0.22} (e^{3.52} -e^{2.2} )[/tex]
[tex]\int\limits^{16}_{10} {f(t)} \, dt = \frac{ 348}{0.22} \times 24.759[/tex]
[tex]\int\limits^{16}_{10} {f(t)} \, dt = 39164.2[/tex]
From the question
[tex]t = 10[/tex] represents the start of 2010.
This means that
[tex]t = 16[/tex] represents the start of 2016.
So, the interpretation is:
The total revenue from the start of 2010 to the start of 2016 is $39.16 billion
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Rank the following asserts of a commercial Bank in order of decreasing liquidity. (a) market loans. (b) Reserves with the bank of Ghana. (c) cash. (d) personal loans. (e) sales and repurchase agreements (repos). (f) mortgages. (g) Government bonds (of from one to five years to motuity)
The rankings are as follows;
Cash.Ghana bank.Personal loan.Market loan.Sales and repurchase agreements.Mortgage.Government bonds.We want to help the user to understand the term liquidity before giving the explanation with respect to ranking the following terms:
Liquidity means an asset or security that should be converted into cash without impacting the market price.
Here the most liquids are the ones that could be converted into cash in an easy manner but we have to rank in order of reducing the liquidity.
Cash = more liquid.Ghana bank along with reserves = less than liquid as cash.Personal loan = less liquid.Market loan = less liquid.Sale & repurchase agreements = less liquid.Mortgage = reduce liquidity. Government bonds.We ranked according to high to low liquidity.
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Training needs analysis
Answer:
is it a true or false question?
A company plans on selling 500 units. The selling price per unit is $10. There are 60 units in beginning inventory, and the company would like to have 100 units in ending inventory. How many units should be produced for the coming period?
a. 540 units
b. 2,000 units
c. 2,035 units
d. 365 units
e. 400 units
When there are batch-level or product-level costs, in comparison to a traditional cost system, an activity-based costing system ordinarily will shift costs from: a. high-volume to low-volume products. b. low-volume to high-volume products. c. specialized to standardized products. d. standardized to specialized products.
Answer: A. high-volume to low-volume products
Explanation:
Batch-level costs refers to the expenses that are related to the group of products which cannot be traced back to an individual item. The cost of production are incurred for the production of a batch.
Activity-based costing refers to the method whereby overhead and indirect costs are assigned to the products and services.
When there are batch-level or product-level costs, in comparison to a traditional cost system, an activity-based costing system ordinarily will shift costs from a high-volume to low-volume products.
Elderly woman purchases a table from a local furniture store for $5,000. She decides she does not want the table because of a defect. The woman successfully cancels the payment on the credit card for payment of the table, and continues to keep the table despite the store requesting to pick the table up from woman. What statement is true:
Answer:
She cannot keep the table
Explanation:
In the given scenario we will look at the different parties and wether they are satisfied with the transaction.
The buyer picked the table after which she complained about a defect and refused to pay. Because she refused to pay she cannot take ownership of the table so she has to return it.
The store did not receive payment for the table so they have the right to request for the table back from the elderly woman.
So she cannot keep the table.
The statement that is true is that she cannot keep the table
In the given scenario, we will look at the different parties and whether they are satisfied with the transaction.
Here, the buyer picked the table after which she complained about a defect and refused to pay. Because she refused to pay she cannot take ownership of the table so she has to return it.
Now, the store did not receive payment for the table so they have the right to request for the table back from the elderly woman.
In conclusion, the statement that is true is that she cannot keep the table
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The common stock of Eddie's Engines, Inc. sells for $45.68 a share. The stock is expected to pay $4.10 per share next year. Eddie's has established a pattern of increasing their dividends by 6.2 percent annually and expects to continue doing so. What is the market rate of return on this stock?
a. 15.18 percent
b. 7.26 percent
c. 8.98 percent
d. 17.67 percent
e. 11.14 percent
Answer:
no entiendo la verdad es que yo hablo español y no entiendo ajaj espero te ayude
Explanation:
15.18
