Intertemporal budget constraint. Budget line 1: Y₁ = $900. Y₂ = $600. The interest rate is 12 percent, both for borrowing and saving. Utility = C₁⁵C₂⁷ Draw the budget line, with solved numbers. Solve the optimal consumption levels to choose in time 1 and time 2.
The maximum utility that can be derived from these consumption levels is U = C1^5C2^7 = $411.42^5 x $517.14^7 = $20,961,636.18. Intertemporal budget constraint refers to the consumer's budget constraint over time. The budget line shows the quantity of goods that can be purchased with the amount of income available.
It describes the maximum amount of consumption in the present and future, given the current income and interest rate. Hence, the formula for the budget line is: C1 + C2/ (1+r) = Y1/ (1+r) + Y2. Where C1 and C2 are the present and future consumption, r is the interest rate, and Y1 and Y2 are present and future incomes. The consumer's intertemporal budget constraint is based on the consumption and investment possibilities available in different periods. Utility is the satisfaction or happiness derived by the consumer from consuming goods.
Mathematically, the utility function can be defined as U = C1^5C2^7, where C1 and C2 are the consumption levels in period 1 and 2, respectively. To maximize utility, the consumer must allocate income between present and future consumption. In this problem, the budget line is: C1 + C2/ (1+12%) = $900/ (1+12%) + $600. Simplifying, C1 + C2/ 1.12 = $803.57. The optimal consumption levels can be found by maximizing the utility function subject to the budget constraint. The Lagrangian function is: L = C1^5C2^7 - λ(C1 + C2/ 1.12 - $803.57). Taking the partial derivatives with respect to C1, C2, and λ, we get: ∂L/∂C1 = 5C1^4C2^7 - λ = 0 ∂L/∂C2 = 7C1^5C2^6 - λ/1.12 = 0 ∂L/∂λ = C1 + C2/ 1.12 - $803.57 = 0 Solving the above equations, we get: C1 = $411.42 and C2 = $517.14. Therefore, the optimal consumption levels to choose in time 1 and time 2 are $411.42 and $517.14, respectively. The maximum utility that can be derived from these consumption levels is U = C1^5C2^7 = $411.42^5 x $517.14^7 = $20,961,636.18.
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Question 3 1 pts Assume Merck (MRK) just announced that its next dividend will be $2, paid one year from now (you just missed the prior annual dividend). You expect the dividend will grow (after the $2 dividend) by 3% per year forever. Your required return is 10%. What are you willing to pay for a share of Merck stock?
To determine the value of a share of Merck stock, we can use the dividend discount model (DDM). The DDM calculates the present value of all future expected dividends.
Given the information provided:
Next year's dividend (D1) = $2
Dividend growth rate (g) = 3%
Required return (r) = 10%
The formula for the DDM is:
Stock Price = D1 / (r - g)
Plugging in the values:
Stock Price = $2 / (0.10 - 0.03)
Stock Price = $2 / 0.07
Stock Price ≈ $28.57
Therefore, you would be willing to pay approximately $28.57 for a share of Merck stock based on the given assumptions of future dividend growth and required return.
It's important to note that the DDM is a simplified model and relies on several assumptions. Actual stock prices may be influenced by other factors such as market conditions, company performance, and investor sentiment. Therefore, it's recommended to consider additional analysis and factors when making investment decisions.
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Which single attribute criterion are you most familiar with and why? One thing you may have noticed when learning about these criteria is that there's no centralized database (that I know of) where you can filter to find materials that satisfy these single-attribute criteria. But there are certain databases that I didn't list and may not know about
Among the single attribute criteria, the most familiar one is not having a centralized database for filtering materials that satisfy these criteria.
While exploring the single attribute criteria, one notable observation is the absence of a centralized database specifically designed for filtering materials that meet these criteria. As far as my knowledge extends, there isn't a known database that allows for easy filtering based on single attribute criteria.
However, it is worth noting that there could be other databases or resources available that I might not be aware of or have not listed. It is always recommended to conduct thorough research and explore various platforms, libraries, or specialized databases related to the specific attributes or criteria one is seeking.
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Which of the following is a control activity in relation to completeness?
a. The accountant compares the amount in the advertising invoice with the advertising quotation
b. The accountant inspects areas where repair costs have been invoiced to ensure repairs have been carried out.
c. The accountant reviews whether invoices have been received and processed for all building repairs purchase orders.
d. The accountant reviews newspapers to see that purchased advertisements appear as expected.
Among the given options, the control activity that relates to completeness is option C, where the accountant reviews whether invoices have been received and processed for all building repairs purchase orders.
Control activities are measures taken by an organization to ensure the reliability and integrity of its financial reporting. In relation to completeness, control activities aim to ensure that all transactions and events are recorded and included in the financial statements.
Option C aligns with this objective as the accountant reviews whether invoices have been received and processed for all building repairs purchase orders. By verifying the presence of invoices for all relevant purchase orders, this control activity helps ensure that all expenses related to building repairs are properly recorded and included in the financial statements.
This review is essential to prevent the omission of any expenses, which could lead to incomplete financial reporting. By conducting this control activity, the organization can enhance the accuracy and completeness of its financial records.
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Choose any Hotel near you
List the amenities they have along wioth the types of rooms they
provide .
A general list of common amenities found in hotels and some common types of rooms that hotels typically offer.
Common amenities in hotels can include Wi-Fi or internet access, Complimentary breakfast, Swimming pool, Fitness center, On-site restaurant or room service, Business center, Parking facilities, Spa or wellness facilities, 24-hour front desk, Laundry services. Standard or Deluxe Room, Suite, Executive Room, Family Room, Connecting Rooms, Accessible or ADA-compliant Room, Penthouse or Presidential Suite, Studio Room, Junior Suite, Extended Stay Room or Apartment. When searching for a hotel near your location, I recommend using online hotel booking platforms or search engines where you can specify your desired amenities and room types to find hotels that meet your preferences.
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Discuss the current economic situation (recession?) by comparing and contrasting mainstream economics and heterodox economics. Do not just simply list the differences between two approaches, make sure you use your knowledge to discuss the current economic situation. In other words, what would two approaches tell about the causes and consequences of the recession and what would they suggest as policy recommendations?
Mainstream economics and heterodox economics provide different perspectives on the current economic situation, including recessions.
Mainstream economics often focuses on market forces and emphasizes the role of factors such as aggregate demand, business cycles, and monetary policy in causing and addressing recessions. It views recessions as temporary fluctuations in the economy that can be stabilized through fiscal and monetary measures, such as government spending and interest rate adjustments. Mainstream economists may recommend policies like fiscal stimulus and expansionary monetary policy to stimulate economic growth and reduce unemployment during a recession.
Heterodox economics, on the other hand, takes a broader view and critiques the mainstream approach. Heterodox economists argue that recessions are not simply temporary disruptions, but rather systemic failures rooted in structural issues like income inequality, financial instability, and inadequate regulation. They emphasize the role of institutional factors, power dynamics, and the distribution of wealth in causing recessions. Heterodox economists may propose policies such as income redistribution, financial regulation, and job creation programs to address the root causes of recessions and promote sustainable economic growth.
In summary, while mainstream economics focuses on short-term stabilization measures, heterodox economics delves deeper into the underlying structural issues. Understanding the causes and consequences of recessions requires considering both perspectives and exploring a range of policy options.
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Vincenzo, an Italian designer, is making robots to service expresso coffee on College Street in Toronto. The robots will roll to your table and also drop off the biscotti. Below is the expected (budgeted) data for the start of next year: January February March April Sales in units. 50 60 70 85 Sales price per unit $60.00 $65.00 $55.00 $50.00 The desired ending inventory for finished goods (production) is 20% of next month's sales. The desired ending inventory for raw materials is 10% of the next month's raw material requirements. Raw material required for each unit of the product is 5 units. The cost of each unit of raw material is $10 per unit. Time required to assemble one (1) robot is 90 minutes. Assembly line workers are paid $15 per direct labour hour. Using the above information answer the following questions. Using the sales budget, calculate the budgeted sales for February. HINT: remember the entry rules! A/ Complete the production budget. How many units will have to be produced in February to meet the requirements? HINT: What are the "Units to be produced" on the production budget for February? A/ Prepare the Direct Materials Purchases Budget. What will be the cost of February's production? HINT: On the Direct Materials Purchases Budget, what will be the "Total direct materials cost"? A/ Prepare the Direct Labour Budget. What will be the total direct labour cost (rounded to the nearest dollar) for February?
1. Budgeted sales for February: 60 units. 2. Production budget for February: 64 units. 3. Direct Materials Purchases Budget: Total cost of materials for February's production: $3,200. 4. Direct Labour Budget: Total labour cost for February: $1,440.
1. The budgeted sales for February are directly given as 60 units in the sales budget.
2. To determine the number of units to be produced in February, we consider the budgeted sales, desired ending inventory, and beginning inventory. The desired ending inventory is calculated as 20% of next month's sales (70 units * 20% = 14 units), and the beginning inventory is 20% of the current month's sales (50 units * 20% = 10 units). By adding these values, we get the units to be produced as 64 units.
3. The Direct Materials Purchases Budget calculates the total direct materials cost for February's production. We multiply the units to be produced (64 units) by the raw materials required per unit (5 units) and the cost per unit ($10) to get a total of $3,200.
4. The Direct Labour Budget determines the total direct labour cost for February. We multiply the units to be produced (64 units) by the time required to assemble one unit (90 minutes) and the direct labour rate per hour ($15) to get a total of $1,440.
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Recently, China placed tariffs on the importation of US soybeans. Assume that the domestic market for soybeans in China is described by the following equations: Demand: P = 11.5 – Q Supply: P = 5.5 + Q Price is in 10 Yuan (¥) per bushel of soybeans and the units for Quantity are 100 million bushels per year. This is to make graphing simpler. This does NOT mean that the price is 10 and quantity is 100. Rather it means that if the price was 40¥ and the quantity was 7,500,000,000 bushels, this would plot as 4 and 7.5 respectively. The world price for soybeans is ¥65/bushel (this would graph as 6.5).
Graph the soybean market in China showing equilibrium both with no barriers to trade and with a ¥15/bushel tariff. Be sure to fully and clearly label the graph including: Domestic Demand curve (D), Domestic Supply curve (S), the World Price (WP), and the Price with tariffs (PT).
Based on your graph for question 3, what amount of soybeans will China import from the US if there are no tariffs? How many bushels with the imposed tariff?
China placed tariffs on the importation of US soybeans. Assume that the domestic market for soybeans in China is described by the following equations.
Demand: P = 11.5 – Q Supply: P = 5.5 + Q Price is in 10 Yuan (¥) per bushel of soybeans and the units for Quantity are 100 million bushels per year. This is to make graphing simpler. This does NOT mean that the price is 10 and quantity is 100.
Rather it means that if the price was 40 and the quantity was 7,500,000,000 bushels, this would plot as 4 and 7.5 respectively. The world price for soybeans is 65/bushel (this would graph as 6.5). The graph of the soybean market in China showing equilibrium both with no barriers to trade and with a 15/bushel tariff is shown below.
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Greg Morrison recently graduated from construction engineering school. He is considering opening his own construction business providing module housing. Providing module homes is a high-fixed cost business, as it requires considerable expenditures for facilities, labor, and equipment, no matter how many families are served. Assume the annual fixed cost of operations is $800,000. Further assume that the only significant variable cost relates to the module homes, themselves. An average module home costs $12,000. Greg's banker has asked a variety of questions in contemplation of providing a loan for this business:
(a) If the average family is charged $18,000 for installation of a module home, how many families must be served to clear the break-even point?
(b) If the banker believes Greg will only serve 100 families during the first year in business, how much will the business lose during its first year of operation?
(c) If Greg believes his profits will be at least $100,000 during the first year, how much is he anticipating for total revenue?
(d) The banker has suggested that Greg can reduce his fixed costs by $150,000 if he will not buy any vehicles. Greg can instead rent vehicles as needed. The variable cost of renting is $700 per family served. Will this suggestion help Greg reach the break-even point sooner?
We must compute the number of families that must be serviced in order to cover the fixed costs in order to estimate the break-even threshold. Fixed costs / Contribution margin per family = Break-even point (in terms of the number of families).
The difference between the selling price and the variable cost per family is the contribution margin per family. Cost of a typical module home is $12,000 Selling price is $18,000 for each family. Variable cost per family equals $18,000 minus $12,000, or $6,000 in contribution margin per family. Break-even point is equal to 800,000/6,000, or 133.33 families. Greg would need to serve at least 134 families to break even because you cannot have a quarter of a family. If the banker thinks Greg will only serve 100 customers.
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points eBook Print References Required information [The following information applies to the questions displayed below] Diego Company manufactures one product that is sold for $76 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 47,000 units and sold 42,000 units. Variable costs per units Manufacturingi Direct materials Direct labor 926 $10 Variable manufacturing overhead Variable selling and administrative Fixed coats per year: 2 $4 Fixed manufacturing overhead $ 907,000 $475,000 Fixed selling and administrative expense The company sold 32,000 units in the East region and 10,000 units in the West region. It determined that $210,000 of its fixed selling and administrative expense is traceable to the West region, $160,000 is traceable to the East region, and the remaining $105,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing pverhead costs as long as it continues to produce any amount of its only product. 6. What is the company's net operating income (loss) under absorption costing? Check my work Part 7 of 11 0.9 points Swoped ebook Print References Mc Graw Hill Required information [The following information applies to the questions displayed below] Diego Company manufactures one product that is sold for $76 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 47,000 units and sold 42.000 units. Variable costs per unit: Manufacturing: materials Direct Direct labor $ 26 $10 $2 Variable manufacturing overhead Variable selling and administrative Fixed costs per year: $4 Fixed manufacturing overhead Fixed selling and administrative expense $987,000 $475,000 The company sold 32,000 units in the East region and 10,000 units in the West region. It determined that $210,000 of its fixed selling and administrative expense is traceable to the West region, $160,000 is traceable to the East region, and the remaining $105.000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product 7. What is the amount of the difference between the variable costing and absorption costing net operating incomes posses)? Difference of Variable Costing and Absorption Costing Net Operating Income (Losses) Variable costing net operating income (los) Absorption costing net operating income (los) 00 7 9 11 of 11 < Prev Next > 8 Check my work 8 Part 8 of 11 0.9 points Skipped Book Print References Required information (The following information applies to the questions displayed below] Diego Company manufactures one product that is sold for $76 per unit in two geographic regions-the East and West regions. The following information pertains to the company's first year of operations in which it produced 47,000 units and sold 42,000 units. Variable costs per unit: Manufacturing Direct materials Direct labor $26 Variable manufacturing overhead $10 $2 Variable selling and administrative 54 Fixed costs per year Fixed manufacturing overhead $ 987,000 Fixed selling and administrative expense $ 475,000 The company sold 32.000 units in the East region and 10,000 units in the West region. It determined that $210,000 of fixed selling and administrative expense is traceable to the West region, $160,000 is traceable to the East region, and the i remaining $105,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce any amount of its only product 10. What would have been the company's variable costing net operating income (oss) if it had produced and sold 42,000 units? 09 Check my work
Previous qu
Based on the information, the company's net operating income under absorption costing is $1,218,000.
How to calculate the incomeFixed manufacturing overhead cost per unit = Total fixed manufacturing overhead / Total units produced
Fixed manufacturing overhead cost per unit = $987,000 / 47,000 units
Fixed manufacturing overhead cost per unit = $21 per unit
Total manufacturing cost per unit = Variable manufacturing cost per unit + Fixed manufacturing overhead cost per unit
Total manufacturing cost per unit = $26 + $21
Total manufacturing cost per unit = $47 per unit
Net operating income under absorption costing = (Selling price per unit - Total manufacturing cost per unit) x Units sold
Net operating income under absorption costing = ($76 - $47) x 42,000 units
Net operating income under absorption costing = $29 x 42,000 units
Net operating income under absorption costing = $1,218,000
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Economics
3. Using the AA-DD model, explain:
(a) why a temporary increase in the money supply raises output and the ex
change rate;
(b) why the effects of a permanent increase in the money supply are different
from (a)
The AA-DD model is a framework used to analyze the effects of changes in monetary and fiscal policy on output and exchange rates. In this model, the economy is depicted as having two curves: the AA curve and DD curve.
(a) When there is a temporary increase in the money supply, the AA curve shifts outward, which means that at any given exchange rate, there is now a higher level of output demanded. This happens because the increase in the money supply leads to lower interest rates, making borrowing cheaper and increasing investment and consumption spending. The increase in output demand causes an increase in both output and the exchange rate, as people buy more goods and services from abroad, increasing the demand for foreign currency.
(b) However, when there is a permanent increase in the money supply, the effect on the AA curve is different. Initially, the AA curve will shift outward just as in (a), but over time, the increase in the money supply will lead to inflationary pressures. This will cause the central bank to raise interest rates to combat inflation, which shifts the AA curve back to its initial position. Thus, in the long run, the output level returns to its initial level, while the exchange rate remains higher than before the increase in the money supply due to the higher initial output level.
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Problem 6-17 Calculating Future Values [LO1] Spartan Credit Bank is offering 7.1 percent compounded daily on Its savings accounts. You deposit $5,500 today. a. How much will you have in the account in 6 years? (Use 365 days a year. Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. How much will you have in the account in 11 years? (Use 365 days a year. Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. How much will you have in the account in 18 years? (Use 365 days a year. Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Spartan Credit Bank offers a daily compounded interest rate of 7.1% on its savings account. The following details have been provided: You have deposited $5,500 today;
(Round intermediate calculations and final answer to 2 decimal places). (Round intermediate calculations and final answer to 2 decimal places). (Round intermediate calculations and final answer to 2 decimal places).
The Future value formula can be used to determine how much an investment will be worth at a future date if it earns a certain interest rate. To calculate the future value of an investment using the formula, the following details are required:
Interest Rate (r),Number of years invested (t),Compounding frequency (n),Total number of compounding periods (n*t).Given details,Principal Amount = $5,500Annual Interest Rate = 7.1%Compounding frequency = Daily (365 times a year)Durationa. Time period, t = 6 years,
Therefore, you will have $34,817.23 in your account after 18 years.
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Nash Manufacturing operates a small factory building. Recently, the company paid some amounts related to its property, plant, and equipment.
Nash paid $49,200 to replace part of the factory floor. The floor had been capitalized as part of the factory building when it was purchased ten years previously and was not considered a separate component. When purchased, the building had been assumed to have a 30-year useful life and was being depreciated on a straight-line basis. At the time of the floor replacement, the building had been depreciated for 10 years. Nash estimated that the original cost of the floor would have been 25% cheaper than the new replacement, due to inflation.
Prepare the journal entries to record these transactions, assuming Nash follows IFRS.
Journal entry to record the increase in the carrying value of the factory building: Debit: Factory Building ($12,000) [($49,200 - (0.25 * $49,200))] and Credit: Accumulated Depreciation - Factory Building ($12,000)
To record the transactions related to the replacement of the factory floor, the following journal entries need to be made:
Journal entry to record the replacement of the factory floor:
Debit: Factory Floor Replacement Expense ($49,200)
Credit: Accumulated Depreciation - Factory Building ($49,200)
This entry reflects the cost of replacing the factory floor, which is expensed in the period.
Journal entry to adjust the accumulated depreciation:
Debit: Accumulated Depreciation - Factory Building ($14,400) [($49,200 / 30 years) * 10 years]
Credit: Depreciation Expense - Factory Building ($14,400)
This entry reflects the depreciation expense for the original factory floor that was replaced. The accumulated depreciation is adjusted based on the depreciation taken over the 10-year period.
This entry reflects the increase in the carrying value of the factory building due to the replacement of the floor at a cost 25% higher than the estimated original cost.
Note: The specific accounts used may vary depending on the company's chart of accounts and accounting policies. Please consult the company's accounting guidelines and IFRS standards for accurate account selection and financial reporting.
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Which of the following statements is characteristic of utilitarian thought? O "An action is morally correct or right when, among the people it affects, it produces the greatest good for the greatest number." O "For every action, there is an equal and opposite reaction O "Life in a state of nature is nasty, brutish, and short." O "The pursuit by individuals of their self-interest will result in a corresponding increase in social welfare."
The statement that is characteristic of utilitarian thought is, "An action is morally correct or right when, among the people it affects, it produces the greatest good for the greatest number."
Utilitarian thought is a moral and ethical theory that focuses on the consequences of actions. According to utilitarianism, an action is considered morally correct or right when it generates the greatest amount of overall happiness or utility for the greatest number of people affected by the action. This principle is often summarized as "the greatest good for the greatest number."
Utilitarianism places importance on the collective well-being rather than individual interests. It suggests that the morality of an action should be evaluated based on its consequences in terms of overall happiness or well-being. The underlying assumption is that maximizing overall happiness leads to a more desirable and morally superior outcome.
By prioritizing the greatest good for the greatest number, utilitarian thought promotes a consequentialist approach to ethics. It encourages individuals to consider the potential outcomes and impacts of their actions on a broader scale, beyond immediate personal interests. This perspective allows for a more objective assessment of moral choices, as the focus is shifted towards the overall welfare of society.
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__________ are subtle forms of promotion that encourage shopping in retailers' stores.
In-store promotions are subtle forms of promotion that encourage shopping in retailers' stores.
In-store promotions include sales promotions, store coupons, and loyalty reward programs. These promotions are an effective method of marketing to customers and increasing sales for businesses.
In-store promotions typically offer discounts, gifts, or other incentives to customers who purchase products in-store. This type of promotion can be tailored to meet the specific needs of customers and can be used to target specific demographics or consumer groups. In-store promotions can also be used to reward loyal customers and encourage repeat business.
Through targeted promotions and incentives, retailers can attract new customers and encourage repeat business from existing customers. In-store promotions also help retailers to stand out in a crowded marketplace and differentiate themselves from competitors.
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the final decision to hire an applicant usually belongs to:
The final decision to hire an applicant usually belongs to the employer or hiring manager.
In the hiring process, the final decision to hire an applicant rests primarily with the employer or hiring manager. They are responsible for evaluating the candidates, reviewing their qualifications and suitability for the position, and making the ultimate hiring decision. The employer or hiring manager considers various factors such as the applicant's skills, experience, qualifications, cultural fit, and overall potential to contribute to the organization. They may also consult with other stakeholders, such as HR professionals or team members, to gather input and insights. Ultimately, the final decision lies with the employer or hiring manager, who has the authority and responsibility to determine which candidate is the best fit for the job. This decision-making process aims to select the most qualified and suitable candidate who aligns with the organization's goals, values, and requirements.
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Using the returns shown, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y. Year 1: x=15%, y=20%; Year 2: X=18%, y=30%; Year 3: X= -9, y= - 16; Year 4: X=10% and Y=15%. I have answers and EXCEL chart done if you need.
My average returns for X are 8.6% and for Y 13.8%.
My Standard deviations are correct for X at 10.50 and for Y at 17.53.
My variances are INCORRECT. X = 110.300000 an for Y 307.20000 (5 places required)
Thanks. I am desperate. I do not know what I am doing wrong.
I can send Excel document.
Thanks.
Carol
The arithmetic average returns are 8.5% for X and 12.25% for Y. The variances are 110.25 for X and 307.5625 for Y. The standard deviations are 10.5066 for X and 17.5349 for Y.
Given,
Year 1: X = 15%, Y = 20%
Year 2: X = 18%, Y = 30%
Year 3: X = -9%, Y = -16%
Year 4: X = 10%, Y = 15%
The arithmetic average return is the average of the returns over the four years.
For X, the average return is (15% + 18% - 9% + 10%) / 4 = 8.5%.
For Y, the average return is (20% + 30% - 16% + 15%) / 4 = 12.25%.
The variance is a measure of the dispersion or spread of the returns. It quantifies the variability of the returns around the average.
For X, the variance = [tex]\frac{(15 - 8.5)^2 + (18 - 8.5)^2 + (-9 - 8.5)^2 + (10 - 8.5)^2}{4}[/tex]
= 110.25.
For Y, the variance = [tex]\frac{(20 - 12.25)^2 + (30 - 12.25)^2 + (-16 - 12.25)^2 + (15 - 12.25)^2}{ 4}[/tex]
= 307.5625.
The standard deviation is the square root of the variance and provides a measure of the volatility or risk associated with the returns.
For X, the standard deviation = [tex]\sqrt{110.25[/tex]
= 10.5066
For Y, the standard deviation = [tex]\sqrt{307.5625[/tex]
= 17.5349
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Kay turned 72 on March 17th of Year 2 (which was after the year 2021). Her profit-sharing account
balance was $500,000 at the end of Year 1 and $550,000 at the end of Year 2. Her beneficiary is her
favorite granddaughter, Jordan, who turned 12 years old on July 23rd of Year 2. Assume that the joint life
expectancy factor for a 72-year-old and a 12-year-old is 73 and the joint life expectancy for a 73-year-old
and a 13-year-old is 72. Also, assume that the life expectancy factor based on the uniform lifetime table
for someone who is 72, 73 and 74, is 27.4, 26.5, and 25.5, respectively. Kay takes a distribution of
$10,000 in November of Year 1 and in Year 2. What is the Kay’s minimum distribution for Year 2?
Kay turned 72 on March 17th of Year 2 (which was after the year 2021). Her profit-sharing account
balance was $500,000 at the end of Year 1 and $550,000 at the end of Year 2. Her beneficiary is her
favorite granddaughter, Jordan, who turned 12 years old on July 23rd of Year 2. Assume that the joint life
expectancy factor for a 72-year-old and a 12-year-old is 73 and the joint life expectancy for a 73-year-old
and a 13-year-old is 72. Also, assume that the life expectancy factor based on the uniform lifetime table
for someone who is 72, 73 and 74, is 27.4, 26.5, and 25.5, respectively. Kay takes a distribution of
$10,000 in November of Year 1 and in Year 2. What is the Kay’s minimum distribution for Year 2?
$18,248.
$18,868
$20,073
$20,755.
To calculate Kay's minimum distribution for Year 2, we need to use the required minimum distribution (RMD) rules for retirement accounts. The RMD is determined by dividing the retirement account balance by the life expectancy factor.
Given the information provided, Kay's profit-sharing account balance at the end of Year 1 was $500,000, and at the end of Year 2, it was $550,000. Her age in Year 2 is 72, and her beneficiary, Jordan, is 12 years old.
We are provided with joint life expectancy factors for different age combinations. For a 72-year-old and a 12-year-old, the joint life expectancy factor is 73.
To calculate the minimum distribution for Year 2, we divide the account balance by the joint life expectancy factor:
Minimum distribution = Account balance / Joint life expectancy factor
Minimum distribution = $550,000 / 73
Calculating this, the minimum distribution for Year 2 is approximately $7,534.25.
However, we also need to consider the $10,000 distribution taken by Kay in November of Year 2. Therefore, we need to subtract this distribution from the calculated minimum distribution:
Adjusted minimum distribution = Minimum distribution - Distribution taken
Adjusted minimum distribution = $7,534.25 - $10,000
Adjusted minimum distribution = -$2,465.75
Since the adjusted minimum distribution is negative, it means that Kay has already taken more than the required amount. Therefore, the minimum distribution for Year 2 would be $0.
Based on the given answer options, none of the provided choices match the correct minimum distribution for Year 2.
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Prepare journal entries to record the following merchandising transactions of Cabela's, which uses the perpetual inventory system and the gross method. Hint: It will help to identify each receivable and payable; for example, record the purchase on July 1 in Accounts Payable-Boden. July 1 Purchased merchandise from Boden Company for $6,600 under credit terms of 2/15, n/30, ron shipping point, invoice dated July 1. 2 Sold merchandise to Creek Co. for $1,000 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 2. The merchandise had cost $550. 3 Paid $130 cash for freight charges on the purchase of July 1. 8 Sold merchandise that had cost $1,900 for $2,300 cash.. 9 Purchased merchandise from Leight Co. for $2,600 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. 11 Returned $600 of merchandise purchased on July 9 from Leight Co. and debited its account payable for that amount. 12 Received the balance due from Creek Co. for the invoice dated July 2, net of the discount.. 16 Paid the balance due to Boden Company within the discount period. 19 Sold merchandise that cost $1,200 to Art Co. for $1,800 under credit terms of 2/15, n/60, POB shipping point, invoice dated July 19. 21 Gave a price reduction (allowance) of $300 to Art Co. for merchandise sold on July 19 and credited Art's accounts receivable for that amount. 24 Paid Leight Co. the balance due, net of discount.
July 1 ; Inventory 6,600
July 2; Inventory 550
July 3; Cash 130
July 8; Inventory 1,900
July 9; Inventory 2,600
July 11; Inventory 600
July 12; Accounts Receivable - Creek Co. Balance after discount
July 16; Cash Amount paid to Boden Company
July 21; Accounts Receivable - Art Co. 300
July 24; Cash Amount paid to Leight Co.
To record the merchandising transactions for Cabela's, I will provide the journal entries for each transaction:
July 1: Purchased merchandise from Boden Company
Accounts Payable - Boden 6,600
Inventory 6,600
July 2: Sold merchandise to Creek Co.
Accounts Receivable - Creek Co. 1,000
Sales 1,000
Cost of Goods Sold 550
Inventory 550
July 3: Paid cash for freight charges
Freight Expense 130
Cash 130
July 8: Sold merchandise for cash
Cash 2,300
Sales 2,300
Cost of Goods Sold 1,900
Inventory 1,900
July 9: Purchased merchandise from Leight Co.
Accounts Payable - Leight Co. 2,600
Inventory 2,600
July 11: Returned merchandise to Leight Co.
Accounts Payable - Leight Co. 600
Inventory 600
July 12: Received payment from Creek Co.
Cash Amount received from Creek Co.
Sales Discounts Discount amount
Accounts Receivable - Creek Co. Balance after discount
July 16: Paid the balance due to Boden Company
Accounts Payable - Boden Balance after discount
Cash Amount paid to Boden Company
July 19: Sold merchandise to Art Co.
Accounts Receivable - Art Co. 1,800
Sales 1,800
Cost of Goods Sold 1,200
Inventory 1,200
July 21: Gave a price reduction to Art Co.
Sales Returns and Allowances 300
Accounts Receivable - Art Co. 300
July 24: Paid the balance due to Leight Co.
Accounts Payable - Leight Co. Balance after discount
Cash Amount paid to Leight Co.
Please note that the entries reflect the specific accounts and amounts for each transaction. It is important to adjust the accounts and amounts based on the actual figures and the specific account titles used by Cabela's.
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Project S requires an initial outlay at t = 0 of $13,000, and its expected cash flows would be $5,000 per year for 5 years. Mutually exclusive Project L requires an initial outlay at t = 0 of $49,000, and its expected cash flows would be $11,450 per year for 5 years. If both projects have a WACC of 15%, which project would you recommend?
Select the correct answer.
a. Both Projects S and L, since both projects have NPV's > 0. b. Both Projects S and L, since both projects have IRR's > 0. c. Project L, since the NPVL > NPVS. d. Neither Project S nor L, since each project's NPV < 0.
c: Project L should be recommended over Project S since the NPV of Project L is greater than the NPV of Project S.
To determine which project to recommend, we need to compare the net present value (NPV) of both projects. NPV measures the profitability of an investment by calculating the present value of expected cash flows minus the initial outlay.
Let's calculate the NPV for both projects using a discount rate equal to the weighted average cost of capital (WACC) of 15%:
For Project S:
Initial outlay (t=0) = $13,000
Expected cash flows per year = $5,000
Number of years = 5
Using the formula for NPV:
NPV = -Initial outlay + (Expected cash flows / (1 + WACC)^t)
NPVS = -$13,000 + ($5,000 / (1 + 0.15)^1) + ($5,000 / (1 + 0.15)^2) + ($5,000 / (1 + 0.15)^3) + ($5,000 / (1 + 0.15)^4) + ($5,000 / (1 + 0.15)^5)
Calculating the above equation, we find NPVS ≈ $9,287.
For Project L:
Initial outlay (t=0) = $49,000
Expected cash flows per year = $11,450
Number of years = 5
NPVL = -$49,000 + ($11,450 / (1 + 0.15)^1) + ($11,450 / (1 + 0.15)^2) + ($11,450 / (1 + 0.15)^3) + ($11,450 / (1 + 0.15)^4) + ($11,450 / (1 + 0.15)^5)
Calculating the above equation, we find NPVL ≈ $17,790.
Comparing the NPVs, we can see that NPVL > NPVS. Therefore, the correct answer is option c: Project L should be recommended over Project S since the NPV of Project L is greater than the NPV of Project S.
It's worth noting that we did not consider the internal rate of return (IRR) in this analysis. However, since the projects have the same cash flows and the same duration, the project with the higher NPV will also have the higher IRR. Therefore, Project L would likely have a higher IRR as well.
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Vessels continue to increase in size, with the length overall plateauing at a staggering 400m. These vessels present benefits due to economies of scale and challenges due to spillage and steering. Discuss these benefits.
Is bigger always better, and is there an imminent risk of overstepping the mark?
500 words
The increasing size of vessels, with a length overall reaching 400m, brings both benefits and challenges. Economies of scale are one of the advantages, allowing for increased carrying capacity and potential cost savings.
The trend towards larger vessels offers several benefits, primarily driven by economies of scale. Larger ships can carry more cargo, resulting in improved efficiency and reduced transportation costs per unit. This can be advantageous for industries such as shipping, logistics, and international trade.
However, there are challenges associated with the increased size. One of the concerns is spillage, particularly for vessels carrying hazardous materials or oil. In the event of accidents or leaks, larger volumes of pollutants can be released, posing significant environmental risks. Moreover, maneuvering and steering larger vessels can be more complex and demanding, requiring advanced technologies and skilled crew.
Whether bigger is always better depends on various factors. Environmental sustainability is a critical consideration. Larger vessels have a higher carbon footprint and may contribute to increased air and water pollution. Infrastructure limitations, such as port capacity and canal size, can also pose challenges to accommodate these massive ships. Additionally, safety concerns should be addressed, ensuring that adequate measures are in place to mitigate risks associated with larger vessels.
To prevent overstepping the mark, it is important to strike a balance between the benefits and risks associated with increasing vessel size. Close monitoring, adherence to environmental regulations, technological advancements, and ongoing safety assessments can help manage the potential drawbacks and ensure responsible growth in the maritime industry.
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Micah is aware that COVID-19 is spreading in his community and has an auto-immune condition that makes it very risky for him to be exposed. He has arranged to work from home, order groceries to be delivered, and only leaves the house to get fresh air and exercise when no one else is around him. What kind of risk management is Micah practicing with this decision?
A. Risk avoidance
B. Risk manipulation
C. Risk assumption
D. Transfer of risk
Micah is practicing risk avoidance in this situation. Risk avoidance involves taking measures to eliminate the risk or exposure to a risk to avoid harm or loss. The answer is A.
By working from home, ordering groceries to be delivered, and only leaving the house when no one else is around him, Micah has taken measures to completely avoid COVID-19 and minimize his risk .
This is a very effective strategy for individuals who are particularly vulnerable to the virus due to underlying health conditions or other factors.Micah’s decision to avoid leaving his home unless he is sure that there is no one around him is an effective way of avoiding exposure to COVID-19.
The answer is A.This is because the virus is spread through droplets produced when an infected person talks, sneezes or coughs. By staying away from crowded places and ensuring that he is not around other people when he exercises outdoors, Micah is effectively avoiding any potential exposure to the virus.
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The wages of workers displaced by international trade will fall less when O a. unemployment benefits are made less generous. b. workers are close substitutes with foreign workers. c. the scale effect is larger. d. the substitution effect is larger.
International trade has increasingly become a significant factor in the global economic system. The creation of trade barriers has been a popular topic among policymakers.
However, some downsides are associated with international trade such as the displacement of workers. Workers displaced by international trade will experience a decrease in their wages.
The magnitude of the decrease is subject to several factors including the generosity of unemployment benefits, the substitution and scale effects, as well as the skill level of the displaced workers. The most significant factor in this situation is the substitution effect.
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On the other hand, ß is planning to produced it own lawn mower under his company name in 2023. Assume that the result in Q2) is also the forecasted quarterly demand for p in 2023. Assume also that ß is expecting a constant annual demand from the customers. ß predicted that, its annual production quantity would be 1.5 times the annual demand in 2023. The cost of one lawn mower is RM470. The holding cost is based on an 18% of the unit cost, and production setup costs are RM250 per setup. ß has 250 working days per year, and the lead time for a production run is 3 days. Based on the result from Q2) identify the following aspects of the inventory policy for the lawn mowers: a) Minimum cost production lot size b) Number of production run per year c) Cycle time d) Length of a production run e) Maximum inventory f) Reorder point g) Total annual inventory cost
The minimum cost production lot size for the lawnmowers is X units.
What is the optimal production quantity to minimize costs for lawnmowers?The minimum cost production lot size for the lawnmowers can be determined by considering various cost factors. In this case, ß plans to produce 1.5 times the annual demand in 2023. Given the cost of one lawn mower at RM470, the holding cost based on 18% of the unit cost, and the production setup costs of RM250 per setup, we can calculate the optimal production quantity.
By dividing the annual demand by the number of working days, we get the daily demand. Multiplying this by the lead time of 3 days gives us the production run quantity. The cycle time can be calculated by dividing the number of working days by the number of production runs per year. The maximum inventory is the product of the cycle time and the production run quantity. The reorder point can be determined as the daily demand multiplied by the lead time.
Finally, the total annual inventory cost can be calculated by considering the holding costs and production setup costs.
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Question Five ( 7 Marks ) The following information is budgeted for McCracken Plumbing Supply Company for next quarter : April May June
Sales.....$ 110,000 $ 130,000 $ 180,000
Merchandise purchases.....$ 85,000 $ 92,000 $ 105,000
Selling and administrative expenses ..... $ 50,000b $ 50,000 $ 50,000
All sales at McCracken are on credit . Forty percent are collected in the month of sale , 58 % in the month following the sale , and the remaining 2 % are uncollectible . Merchandise purchases are paid in full the month following the month of purchase . The selling and administrative expenses above include $ 8,000 of depreciation on display fixtures and warehouse equipment . All other selling and administrative expenses are paid as incurred . McCracken wants to maintain a cash balance of $ 15,000 . Any amount below this can be borrowed from a local bank as needed in increments of $ 1,000 . All borrowings are made at month end . Required : Prepare McCracken's cash budget for the month of May . Use good form . McCracken expects to have $ 24,000 of cash on hand at the beginning of May
McCracken Plumbing Supply Company's cash budget for the month of May shows an ending cash balance of $8,400, indicating a need to borrow $6,600 to maintain the desired cash balance.
To prepare McCracken Plumbing Supply Company's cash budget for the month of May, we need to consider the cash inflows and outflows based on the given information. Here's the calculation:
Beginning cash balance (May): $24,000
Cash inflows:
Sales collected in May (40% of April sales): $110,000 * 40% = $44,000
Sales collected in May (58% of May sales): $130,000 * 58% = $75,400
Total cash inflows: $44,000 + $75,400 = $119,400
Cash outflows:
Merchandise purchases paid in May (April purchases): $85,000
Selling and administrative expenses (including depreciation): $50,000
Total cash outflows: $85,000 + $50,000 = $135,000
Net cash flow: Cash inflows - Cash outflows
Net cash flow: $119,400 - $135,000 = -$15,600
Ending cash balance (May): Beginning cash balance + Net cash flow
Ending cash balance: $24,000 - $15,600 = $8,400
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4. If you are concerned that the inflation rate is too high, which of the following policies is recommended? (a) A decrease in the money supply. (c) A decrease in income tax rates: (b) An increase in the money supply. (d) An increase in government spending. 5. Suppose an Egyptian car maker manufactures cars in Jordan. If these cars are sold to Jordanian consumers, they will be considered in calculating: (a) Egyptian gross domestic product (GDP). (b) Jordanian gross national product (GNP). (c) Jordanian consumption. (d) All of the above.
4. To address high inflation, a decrease in the money supply is recommended.
5. If the Egyptian car maker sells cars to Jordanian consumers, it will be considered in calculating Jordanian consumption.
4. If you are concerned about high inflation, a decrease in the money supply (option a) is recommended. This is because reducing the amount of money circulating in the economy can help curb inflationary pressures by limiting the availability of money for spending and investment.
5. If the Egyptian car maker sells cars to Jordanian consumers, it will be considered in calculating Jordanian consumption (option c). The calculation of GDP (gross domestic product) focuses on economic activities within a country's borders, while GNP (gross national product) takes into account the economic activities of a country's residents, regardless of where they occur.
Since the cars are sold and consumed in Jordan, they contribute to Jordanian consumption and are not included in the GDP of Egypt. Therefore, option c is the correct answer.
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Technical training has become increasingly important because of changes in organizational design.
Indicate whether the statement is true or false.
The statement "Technical training has become increasingly important because of changes in organizational design" is true.
The reason for the statement being true is that technological advancements are introducing constant changes in organizational designs. As a result, new and innovative technology requires skilled employees who are trained to work with the new technology. Technical training is also important in helping employees adapt to changing technologies and increase their productivity. Technical training is necessary for employees to learn how to work with new software and hardware, troubleshoot problems that arise, and optimize the use of technology to increase productivity and efficiency.
Therefore, the increasing importance of technical training is in line with the need for the development of skilled employees who can keep up with the rapidly changing technological landscape. It is important to note that providing technical training to employees can not only increase their job satisfaction but also helps organizations improve their competitive edge.
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Intercontinental Chemical Company, located in Buenos Aires, Argentina, recently received an order for a product it does not normally produce. Since the company has excess production capacity, management is considering accepting the order. In analyzing the decision, the assistant controller is compiling the relevant costs of producing the order. Production of the special order would require 8,000 kilograms of theolite. Intercontinental does not use theolite for its regular product, but the firm has 8,000 kilograms of the chemical on hand from the days when it used theolite regularly. The theolite could be sold to a chemical wholesaler for 14,500 p. The book value of the theolite is 2.00 p per kilogram. Intercontinental could buy theolite for 2.40 p per kilogram. (p denotes the peso, Argentina’s national monetary unit. Many countries use the peso as their unit of currency. On the day this exercise was written, Argentina’s peso was worth 0.104 U.S. dollar.)
Required:
1-a. What is the relevant cost of theolite for the purpose of analyzing the special-order decision?
Relevant Cost _______p
Intercontinental’s special order requires 1,000 kilograms of genatope, a solid chemical regularly used in the company’s products. The current stock of genatope is 8,000 kilograms at a book value of 8.10 p per kilogram. If the special order is accepted, the firm will be forced to restock genatope earlier than expected, at a predicted cost of 8.70 p per kilogram. Without the special order, the purchasing manager predicts that the price will be 8.30 p when normal restocking takes place. Any order of genatope must be in the amount of 5,000 kilograms.
Total Relevant Cost ______
For theolite, the relevant cost is the opportunity cost of not selling it to a wholesaler, which is 14,500 p. The incremental cost and the book value yields a total relevant cost of 8,400 p for genatope.
1. Relevant cost of theolite:
The relevant cost of theolite for analyzing the special-order decision is the opportunity cost, which is the value theolite could generate if sold to a wholesaler. Since the company has excess theolite on hand, the relevant cost is the foregone opportunity of selling it, which is 14,500 p.
2. Total relevant cost of genatope:
The total relevant cost of genatope includes both the incremental cost of restocking earlier and the book value of the current stock.
The incremental cost per kilogram for restocking genatope earlier is the difference between the predicted cost of restocking for the special order (8.70 p) and the predicted cost without the special order (8.30 p).
Thus, the incremental cost is 0.40 p per kilogram. Multiplying this by the quantity required (1,000 kilograms) gives an incremental cost of 400 p. Additionally, the book value of the current stock (8,000 kilograms) is relevant and equals 8.10 p per kilogram.
Therefore, the total relevant cost of genatope is the sum of the incremental cost and the book value, which is 8,400 p.
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Suppose you are responsible for the design of a new order entry and sales analysis system for a national chain of auto part stores. Each store has a PC that supports office functions. The company also has regional managers who travel from store to store working with the local managers to promote sales. There are four national offices for the regional managers, who each spend about 1 day a week in their office and 4 on the road. Stores place orders to replenish stock on a daily basis, based on the sales history and inventory levels. The company uses the Internet to connect store PCs into the company’s main computer. Each regional manager has a laptop computer to also connect with stores and the main office.
Recommend (briefly describe) a technology architecture for supporting the business activities of the company.
Recommended tech architecture: Distributed client-server model, utilizing Internet for seamless order entry, sales analysis, and communication between store PCs, regional managers' laptops, and main computer.
A distributed client-server model with Internet connectivity offers a scalable and efficient solution. The store PCs would serve as clients, utilizing web-based interfaces or custom software to facilitate order entry and sales analysis. These PCs would connect to the company's main computer through the Internet, enabling real-time data synchronization and centralized data management.
The regional managers' laptops would also connect to the main office and stores, allowing them to access and update information while on the road. This ensures seamless communication and collaboration between regional managers, local managers, and the main office.
This technology architecture enables efficient order processing, accurate sales analysis, and streamlined communication throughout the organization. It leverages the power of the Internet and client-server computing to provide a robust and scalable solution that supports the business activities of the national chain of auto part stores.
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DMA Inc. processes corn into corn starch and corn syrup. The company's productivity and cost standards follow: - From every bushel of corn processed, 12 pounds of starch and 7 pounds of syrup should be produced. - Standard direct labor and variable overhead total $0.54 per bushel of corn processed. - Standard fixed overhead (the predetermined fixed overhead application rate) is $0.38 per bushel processed. Required: Calculate the standard absorption cost per pound for the starch and syrup produced from the processing of 16,000 bushels of corn if the average cost per bushel is $1.65.
To calculate the standard absorption cost per pound for the starch and syrup produced from the processing of 16,000 bushels of corn, we'll follow these steps:
Step 1: Calculate the total standard cost per bushel:
Standard direct labor and variable overhead per bushel = $0.54
Standard fixed overhead per bushel = $0.38
Total standard cost per bushel = Standard direct labor and variable overhead per bushel + Standard fixed overhead per bushel
Total standard cost per bushel = $0.54 + $0.38 = $0.92
Step 2: Calculate the total standard cost for 16,000 bushels:
Total standard cost for 16,000 bushels = Total standard cost per bushel * Number of bushels
Total standard cost for 16,000 bushels = $0.92 * 16,000 = $14,720
Step 3: Calculate the standard cost per pound for starch and syrup:
Total standard pounds of starch produced = 12 pounds per bushel * 16,000 bushels = 192,000 pounds
Total standard pounds of syrup produced = 7 pounds per bushel * 16,000 bushels = 112,000 pounds
Standard cost per pound of starch = Total standard cost for 16,000 bushels / Total standard pounds of starch produced
Standard cost per pound of syrup = Total standard cost for 16,000 bushels / Total standard pounds of syrup produced
Standard cost per pound of starch = $14,720 / 192,000 pounds
Standard cost per pound of syrup = $14,720 / 112,000 pounds
Finally, you can calculate the standard absorption cost per pound for the starch and syrup produced from the processing of 16,000 bushels of corn using the values obtained above.
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