Determine depreciation under three methods (LO7-4)Speedy Delivery Company purchases a delivery van for $37,600. Speedy estimates that at the end of its four-year service life, the van will be worth $5,800.
The business forecasts driving the vehicle 159,000 kilometres over the course of the four years. In year 1 and year 2, the actual miles driven each year were 42,000 and 45,000, respectively.
2. Determine the annual depreciation for the van's initial two years using each of the approaches shown below. (Be careful while rounding your calculations.) using a straight line. Calculating the annual depreciation expense is the first step. Straight-line depreciation is calculated as follows:
annual depreciation = (cost - residual value) / useful life
First year depreciation = ($37,600 - $5,800) / 4 years = $7,450
Year 2 Depreciation = ($37,600 - $5,800) / 4 years = $7,450
Note: Depreciation expense is the same for each year with the straight-line method. Double-declining-balance method.
The first step is to calculate the depreciation rate. The formula for double-declining balance is:
depreciation rate = (100% / useful life) × 2
First year depreciation = Beginning book value × Depreciation rate = $37,600 × 50% = $18,800
Year 2 Depreciation = ($37,600 - $18,800) × 50% = $9,400
Note: The depreciation expense decreases each year with the double-declining balance method. Activity-based method. The first step is to calculate the per-mile depreciation rate.
The formula for activity-based depreciation is:
per-mile depreciation = (cost - residual value) / total miles expected
First year depreciation = per-mile depreciation × actual miles driven
First year depreciation = ($37,600 - $5,800) / 159,000 miles
First year depreciation = $0.20 per mile
First year depreciation = $0.20 per mile × 42,000 miles = $8,400
Year 2 Depreciation = $0.20 per mile × 45,000 miles = $9,000
Note: Depreciation expense varies with the activity-based method based on the miles driven each year.
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EcoFabrics has budgeted overhead costs of $945,000. It has allocated overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 450,000 for the current year. The company has decided to experiment with activity-based costing and has created two activity cost pools and related activity cost drivers. These two cost pools are cutting (cost driver is machine hours) and design (cost driver is number of setups). Overhead allocated to the cutting cost pool is $360,000 and $585,000 is allocated to the design cost pool. Additional information related to these pools is as follows.WoolCottonTotalMachine hours 100,000 100,000 200,000Number of setups 1,000 500 1,500 Calculate the overhead rate using activity based costing. (Round answers to 2 decimal places, e.g. 12.25.)Overhead rates for activity-based costing Cutting $per machine hourDesign $per setupLINK TO TEXTLINK TO TEXT Determine the amount of overhead allocated to the wool product line and the cotton product line using activity-based costing.Wool product lineCotton product lineOverhead Allocated $$LINK TO TEXTLINK TO TEXT Calculate the overhead rate using traditional approach. (Round answer to 2 decimal places, e.g. 12.25.)Overhead rates using the traditional approach $per direct labor hourLINK TO TEXTLINK TO TEXT What amount of overhead would be allocated to the wool and cotton product lines using the traditional approach, assuming direct labor hours were incurred evenly between the wool and cotton?Wool product lineCotton product lineOverhead Allocated $$
For the first question, the overhead rates using activity-based costing are $0.18 per machine hour for the cutting cost pool and $0.39 per setup for the design cost pool. For the second question, the overhead allocated to the wool product line would be $180,000 and the overhead allocated to the cotton product line would be $385,000. For the third question, the overhead rate using the traditional approach is $2.11 per direct labor hour. For the fourth question, the amount of overhead allocated to the wool product line would be $225,500 and the overhead allocated to the cotton product line would be $719,500.
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increasing the benefits offered to unemployed workers through the government's unemployment insurance program extending the number of weeks for which unemployed workers are eligible for unemployment insurance benefits from the government improving a widely used job-search website so that it matches workers to job vacancies more effectively
These are government policies aimed at reducing unemployment, including increasing the benefits of the government's unemployment insurance program and extending the eligibility period for benefits.
This also includes improving a job-search website to better match workers with job vacancies.
The goal of these policies is to provide financial support for those who are out of work, to encourage them to continue seeking employment and reduce the overall unemployment rate. By increasing the benefits and eligibility period for unemployment insurance, workers have more time and resources to find suitable employment.
Additionally, improving the job-search website can help connect job seekers with suitable job opportunities, reducing the time it takes to find a job and improving the overall efficiency of the job market.
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true or false when a provider has market dominance, and hence can set its own prices (within reason), it is called a price taker.
The statement "when a provider has market dominance, and hence can set its own prices (within reason), it is called a price taker" is false because that is called a price setter, not a price taker.
What is a price setter?A price setter is a business or industry that has control over the market price of goods or services. This is achieved through the use of monopolistic competition, oligopoly, or a monopoly. In an oligopoly, for example, the top four firms account for 80% of the market. These businesses have considerable power over the market since their pricing and output strategies influence market conditions. The company can set its prices above those of its competitors due to its monopoly position. This will be to maximize profits by charging the highest price that consumers are willing to pay.
What is a price taker?A price taker, on the other hand, is a firm or industry that accepts the market price determined by supply and demand forces. Small businesses and startups are more likely to be price takers since they lack market power to set prices. The market price is the going rate for a product or service. Businesses that do not have a monopoly or oligopoly position are price takers, and they must accept the market price. They have no influence over the market price since their output is minor, and they must accept the market price to be competitive.
What is market dominance?Market dominance is when a company or group of firms controls a significant portion of the market. A company that holds a significant portion of the market may have an unfair advantage over its competitors, which can lead to a monopolistic or oligopolistic market. When a company has market power, it can charge higher prices or reduce product quality without fear of losing customers. Governments frequently take measures to promote competition and prevent businesses from dominating the market, to protect consumers from paying excessive prices.
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a company uses the allowance method to estimate its bad debt expense. at the end of the year, the controller uses the aging-of-receivables method and estimates that $10,000 of accounts receivable will be uncollectible. with a debit balance of $2,000 in the allowance for bad debts account, what would be the correct entry to recognize bed debt expense?
The correct entry to recognize bed debt expense would be:
Bad Debt Expense $8,000 Allowance for Bad Debts$8,000Given, the following details of a company that uses the allowance method to estimate its bad debt expense: At the end of the year, the controller uses the aging-of-receivables method and estimates that $10,000 of accounts receivable will be uncollectible, and With a debit balance of $2,000 in the allowance for bad debts account. We are to find out the correct entry to recognize bed debt expense.
The aging method is a method used to estimate uncollectible accounts receivable by analyzing the receivables according to the age of each account. Thus, the Aging of Receivables Method estimates the portion of the current accounts receivable that will not be collected. The accounting entry to recognize bad debt expense is to debit Bad Debt Expense and credit Allowance for Doubtful Accounts.
The allowance method requires that an estimate of the expected losses from uncollectible accounts be made at the end of each accounting period. The estimated amount of losses is then charged to Bad Debt Expense and credited to Allowance for Doubtful Accounts. The following table shows the calculation of the required entry to recognize bed debt expense:
Accounts receivable that are 30 days past due$20,000×3%=$600
Accounts receivable that are 60 days past due$15,000×7%=$1,050
Accounts receivable that are 90 days past due$10,000×15%=$1,500
Accounts receivable that are 120 days past due$5,000×20%=$1,000
Total estimate of uncollectible accounts receivable$4,150
Less: Existing credit balance in Allowance for Bad Debts$(2,000)
Bad Debt Expense$2,150.
In other words, the amount of Bad Debt Expense should be $2,150, which is calculated as the total estimate of uncollectible accounts receivable ($4,150) less the existing credit balance in Allowance for Bad Debts ($2,000).Since the problem states that the controller estimates $10,000 of accounts receivable to be uncollectible, then the amount of the entry to recognize bad debt expense should be $10,000 − $2,000 = $8,000.
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To decrease the costs of operating a lock in a large river, a new system of operation is proposed. The system will cost $830,000 to design and build. It is estimated that it will have to be reworked every 10 years at a cost of $120,000. In addition, an expenditure of $80,000 will have to be made at the end of the fifth year for a new type of gear that will not be available until then. Annual operating costs are expected to be $70,000 for the first 15 years and $100,000 a year thereafter. Compute the capitalized cost of perpetual service at i=7%.
The capitalized cost of perpetual service is $4,201,394.23 at i=7%.
To compute the capitalized cost of perpetual service, we need to find the present value of all future costs associated with the system.
Step 1: Calculate the present value of the initial cost of designing and building the system:
PV of initial cost = $830,000
Step 2: Calculate the present value of the recurring maintenance costs:
PV of recurring maintenance costs = $120,000 / 0.07 = $1,714,285.71
Step 3: Calculate the present value of the gear replacement cost at the end of the fifth year:
PV of gear replacement cost = $80,000 / 1.07^5 = $58,099.47
Step 4: Calculate the present value of the annual operating costs for the first 15 years:
PV of annual operating costs for first 15 years = $70,000 x [(1 - (1 / 1.07^15)) / 0.07] = $579,963.94
Step 5: Calculate the present value of the annual operating costs after the first 15 years:
PV of annual operating costs after 15 years = $100,000 / (0.07 - 0.03) / 1.07^15 = $1,019,045.11
Step 6: Add up all the present values to find the capitalized cost of perpetual service:
Capitalized cost of perpetual service = PV of initial cost + PV of recurring maintenance costs + PV of gear replacement cost + PV of annual operating costs for first 15 years + PV of annual operating costs after 15 years
= $830,000 + $1,714,285.71 + $58,099.47 + $579,963.94 + $1,019,045.11
= $4,201,394.23
Therefore, the capitalized cost of perpetual service is $4,201,394.23 at i=7%.
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A memorandum on the sale of goods that does not indicate the _____ of goods to be sold will not satisfy the UCC's writing requirement.
A. quality
B. quantity
C. delivery
D. cost
A memorandum on the sale of goods that does not indicate the quantity of goods to be sold will not satisfy the UCC's writing requirement. The correct answer is option B.
A Memorandum, also known as a Confirmation, is a written confirmation of a contract for the sale of goods. It's a brief statement of the terms of the contract, including the price, quality, and type of goods.
The Uniform Commercial Code (UCC) is a set of laws governing commercial transactions that set out the duties and rights of parties involved in commercial transactions.
The UCC has a writing provision that necessitates that certain contracts be in writing.
Thus, a memorandum on the sale of goods does not indicate the quantity of goods. Option B is correct.
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in order to be successful, bpm requires all of the following except . a. buy-in from a broad cross section of the business b. software to map processes that are performed manual c. the right technology d. highly effective change management processes
The right technology. Business Process Management (BPM) requires buy-in from a broad cross section of the business, software to map processes that are performed manually, and highly effective change management processes in order to be successful. The correct answer is C.
The first part of successful BPM is buy-in from a broad cross section of the business. Buy-in ensures that all stakeholders are on board with the changes BPM will bring and understand their role in the process. It also ensures that the changes will be accepted and supported.
Software to map processes that are performed manually is necessary to gain a thorough understanding of existing processes. This helps identify and measure key performance indicators, highlight process bottlenecks and areas for improvement, and develop and streamline processes.
Change management processes are essential for successful implementation of BPM. It is important to have a well-defined process for change management, including training, communication, and monitoring. The right technology is not essential for successful BPM, although it can help to automate and streamline processes.
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Creating a new product to increase margin is an example of using product implementations to achieve competitive advantage.True or false
By creating a new product, companies can increase their margins by offering a product that is differentiated from competitors. This allows them to charge a premium price and increase their margins. Thus, this statement is True.
A competitive advantage is a feature that enables a company to outperform its competitors. Competitive advantage enables a business to achieve superior performance or generate greater profits than its rivals, allowing it to develop more customers and gain a larger market share than its competitors.
When a business has a competitive advantage, it is in a more robust position to capture a larger market share than its competitors.
In this case, creating a new product to increase margin is an example of using product implementations to achieve a competitive advantage. One of the ways companies can gain a competitive advantage is by introducing new products into the market.
As a result, companies can use this method to introduce new products that will help them gain a competitive advantage over their rivals.
The introduction of a new product will assist the company in increasing its margin, which will enable it to outperform its rivals.
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which of the options below defines a non-excludable good? question 2 options: consumption by one person does not diminish the quantity of consumption by others. consumption by one person diminishes the quantity of consumption by others. it is difficult (or very costly) to prevent consumption by those who do not pay for the good. it is easy (or relatively costless) to prevent consumption by those who do not pay for the good.
In the following question, among the conditions given, A non-excludable goods is defined as a good that 'is difficult (or very costly) to prevent consumption by those who do not pay for the good."
What is a non-excludable good? A non-excludable good is defined as a good that is difficult (or very costly) to prevent consumption by those who do not pay for the good. This makes it difficult for suppliers to sell and market these kinds of products, which results in the government having to provide or subsidize them. Because it is difficult to stop people from using them, these goods often result in market failure. Types of Non-Excludable goodsThere are two types of non-excludable goods: Pure Non-Excludable Goods: These goods are the ones that everybody has access to, even if they do not pay for them. National parks and oceans are examples of such goods. Partly Non-Excludable Goods: These goods are ones that are non-excludable, but only to a certain degree. Cable TV and private clubs, for example, fall into this category. Even if you do not pay for them, you will be excluded to a certain extent, such as not having access to particular features.
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the efficiency factor involves both productive and allocative efficiency, which means in order to reach its full production potential an economy must . multiple choice question. a. use the most resources to get the most goods and services for the most people b. use its resources to maximize profits at any cost c. use its resources in the most costly way to produce the specific mix of goods that maximizes people's well-being d. use its resources in the least costly way to produce the specific mix of goods that maximizes people's well-being
The efficiency factor involves both productive and allocative efficiency, which means in order to reach its full production potential an economy must use its resources in the least costly way to produce the specific mix of goods that maximizes people's well-being.
What is the efficiency factor? In economics, the efficiency factor refers to the production of as much output as possible using the least amount of input. An economy's productive efficiency is the ability to create as much output as possible with the resources available. Allocative efficiency refers to an economy's ability to create the optimal allocation of goods and services that maximizes people's well-being. In other words, it refers to how well an economy allocates its scarce resources to produce the optimal mix of goods and services to satisfy consumer preferences. In order to reach its full production potential, an economy must use its resources in the least costly way to produce the specific mix of goods that maximizes people's well-being. Therefore, the answer is option D, which means an economy must use its resources in the least costly way to produce the specific mix of goods that maximizes people's well-being.
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january 41,000 february 38,000 march 50,000 april 51,000 patrick's policy is to have 25% of next month's sales in ending inventory. on january 1, it is expected that there will be 6,700 drums of solvent on hand. required: prepare a production budget for the first quarter of the year. show the number of drums that should be produced each month as well as for the quarter in total. patrick inc. production budget for the coming quarter january february march 1st
The number of drums that should be produced each month would be January: 40,380, February - 39,920, march - 50,160, and the total drums for the quarter 135,050.
A production Budget is a financial plan that summarizes a company's goals for the production of goods or services. The production budget is intended to assist businesses in determining the number of goods to be produced to fulfill consumer demand.
In this problem, the Production Budget for the first quarter of the year is required. January sales are 41,000 units, February sales are 38,000 units, and March sales are 50,000 units, totaling 129,000 units.
According to Patrick's policy, 25% of next month's sales will be held in inventory. So, the ending inventory for January is expected to be 10,250 units (25% of February's sales of 38,000), for February it will be 9,500 units (25% of March's sales of 50,000), and for March it will be 12,500 units (25% of April's sales of 51,000).
Thus, the total units needed to satisfy consumer demand and maintain the expected ending inventory level are 43,800 units for January, 41,000 units for February, 50,250 units for March, and 135,050 units for the quarter as a whole.
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Aftercalculating both the brand development index (BDI) and the category developmentindex (CDI), a media planner obtains the following results: High BDI and LowCDI. What do these results imply?
The implication of obtaining a high brand development index (BDI) and low category development index (CDI) is that "high market share and monitor for salesdecline".
This means that the brand has a strong presence in its specific market but the overall market growth is not significant. Therefore, the media planner should monitor the sales performance of the brand to ensure that its market share does not decline due to potential competitors or changing consumer trends.
It is important to maintain the brand's competitive edge through effective marketing and advertising strategies. By keeping an eye on sales trends, the media planner can make informed decisions about adjusting their marketing efforts and budgets to maintain the brand's market position.
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determine the ror for a project that has an initial cost of $82,000 and would provide positive cash flows of $12,000 the first year, $14,000 the second year, $16,000 the third year, $18,000 the fourth year, $20,000 the fifth year, and $22,000 the sixth year.
The IRR of the project is 17.6% for the rate of return (ROR) of a project that has an initial cost of $82,000 and would provide positive cash flows of $12,000 the first year, $14,000 the second year, $16,000 the third year, $18,000 the fourth year, $20,000 the fifth year, and $22,000 the sixth year.
By using the formula for calculating Internal Rate of Return (IRR).
IRR is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.
The formula for calculating IRR is:
[tex]IRR = R + [(FV / PV) * (1 + R) ^ n - 1] / [(1 + R) ^ n - 1][/tex]
Where:
In this case, we have an initial cost of $82,000, which is the present value (PV).
The future value (FV) is the sum of all the cash flows,
which is $82,000 + $12,000 + $14,000 + $16,000 + $18,000 + $20,000 + $22,000 = $144,000.
And the number of periods (n) is 6.
[tex]IRR = R + [(144,000 / 82,000) * (1 + R) ^ 6 - 1] / [(1 + R) ^ 6 - 1][/tex]
IRR=17.6
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which of the following is a defense under strict products liability? question 37 options: rescission comparative responsibility contributory negligence comparative fault assumption of the risk
The defense under strict product liability is the assumption of the risk.
What is strict product liability?Strict product liability is a legal doctrine that holds manufacturers, distributors, and sellers liable for any injuries or damages caused by their defective products without requiring the plaintiff to prove negligence or fault on their part. It is an essential consumer protection tool that incentivizes manufacturers to make safe products by holding them accountable for any defects or hazards that they produce.
Strict product liability holds the seller of a product strictly liable for any damages or injuries caused by the product, regardless of the seller’s level of fault or negligence. The assumption of the risk defense states that the plaintiff was aware of the risks and chose to use the product anyways, thus releasing the seller from liability.
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if sandstorm corporation chooses to defer and amortize its research and experimental expenditures over a period of 60 months, what are its related deductions in 2021 and 2022?
If Sandstorm Corporation chooses to defer and amortize its research and experimental expenditures over a period of 60 months, its related deductions in 2018 is $127,500 and in 2019 is $1,954.17.
Deduction in 2018:According to the given data, Sandstorm Corporation incurs the following expenses in 2018:
Salaries = $85,000
Materials = $30,000
Depreciation on equipment = $12,500
Therefore, the total expenses in 2018 are:
Total expenses = Salaries + Materials + Depreciation on equipment
= $85,000 + $30,000 + $12,500
= $127,500
Now, the related deductions of Sandstorm Corporation in 2018 are:
Related deductions in 2018 = Total expenses = $127,500
Deduction in 2019:The total expenditures that Sandstorm Corporation will incur in 2019, after the benefits of the project start from July 2019, are calculated below.
The total number of months Sandstorm Corporation has to amortize its research and experimental expenditures = 60 months
Given that the benefits of the project will be realized starting in July 2019, therefore, the remaining months left for the project = (60 - 6) = 54 months
The total expenditures that Sandstorm Corporation will incur in 2019 are:
Total expenditures in 2019 = Salaries + Materials + (Depreciation on equipment / 5 years) x (number of months remaining for the project / 12 months)
Therefore, substituting the given values in the above equation,
Total expenditures in 2019 = $85,000 + $30,000 + ($12,500 / 5) x (54 / 12)= $85,000 + $30,000 + $2,250= $117,250
Therefore, the related deductions of Sandstorm Corporation in 2019 are:
Related deductions in 2019 = Total expenditures in 2019 / 60= $117,250 / 60= $1,954.17
Hence, the related deductions of Sandstorm Corporation in 2018 and 2019 are $127,500 and $1,954.17 respectively.
Note: The question is incomplete. The complete question probably is: Sandstorm Corporation decides to develop a new line of paints. The project begins in 2018. Sandstorm incurs the following expenses in 2018 in connection with the project: Salaries $85,000 Materials 30,000 Depreciation on equipment 12,500 The benefits from the project will be realized starting in July 2019. If Sandstorm Corporation chooses to defer and amortize its research and experimental expenditures over a period of 60 months, what are its related deductions in 2018 and 2019?
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An entrepreneur decided to leave a job that pays $50,000 a year to start a business. These lost wages would be considered ______________ .Select the correct answer below:A. economic profitB. an explicit costC. an implicit costD. accounting profit
An entrepreneur decided to leave a job that pays $50,000 a year to start a business. These lost wages would be considered an implicit cost. The correct answer is option c.
Implicit costs are expenses that are not directly paid out of pocket. They are non-monetary expenses, such as lost time, missed opportunities, or foregone earnings, that are frequently ignored in accounting records or financial statements.
Lost wages are an example of an implicit cost. When entrepreneurs begin a business, they must devote time and effort to it, which means they must give up the opportunity to earn money elsewhere. When an entrepreneur invests in their own company, their wages are used to finance the company's operations rather than to pay themselves. Implicit costs, also known as opportunity costs, can be difficult to quantify since they are subjective and vary depending on the individual's perspective.
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When considering factors that shift demand curves, which of the following will decrease the market demand for a product? Select the two correct answers below. O a drop in the population likely to buy the good in question O a rise in the price of complements O a rise in the population likely to buy the good in question O a drop in the price of complements
The two factors that will decrease the market demand for a product are:
A drop in the population likely to buy the good in question:A decrease in the number of consumers who are interested in buying the product will lead to a decrease in the overall demand for the product.
A rise in the price of complements:Complementary goods are those that are often used together with the product in question. If the price of the complementary goods increases, then the demand for the product will decrease as the overall cost of using the product along with its complements will increase.
A rise in the population likely to buy the good in question will increase the market demand for a product. This is because an increase in the number of consumers who are interested in buying the product will lead to an increase in the overall demand for the product. Similarly, a drop in the price of complements will also increase the market demand for a product as it will become cheaper for consumers to buy both the product and its complementary goods.
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Which of the following is true about Maven?
- Maven is a project management and comprehension tool.
- Maven provides developers a complete build lifecycle framework.
- Both of the above.
- None of the above.
Maven is a project management and comprehension tool that provides developers a complete build lifecycle framework. Therefore, the correct option is "Both of the above.
"Maven: Maven is a project management and comprehension tool. Maven is built with Java, and it was created by Apache Software Foundation. Maven's key feature is the POM (Project Object Model). It's a metadata file for projects that specifies how they are constructed, their dependencies, and how they are to be constructed. Maven's central function is to construct projects by compiling source code, generating binary archives, and running unit tests, among other things.Maven provides developers a complete build lifecycle framework that includes project development, document creation, testing, and deployment. This framework includes a set of plug-ins that provide preconfigured scripts for different phases of the development lifecycle. The POM (Project Object Model) specifies the plug-ins to be used at each phase of the lifecycle.The correct option is "Both of the above." Maven is a project management and comprehension tool that provides developers with a complete build lifecycle framework.
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Which of these is (are) most likely to increase productivity? A) higher corporate tax rates. B) increase in pop. C) investments in research and development.
What is productivity?
Productivity is the amount of production that can be generated from a certain amount of inputs. It is an assessment of efficiency in which a company transforms inputs into outputs.
What are Investments in research and development?
The money put into research and development (R&D) to enhance the goods and services a company provides is referred to as investments in research and development. R&D initiatives may lead to the creation of new goods or procedures that can make a company more profitable by allowing it to gain a larger market share, for example.
Investments in research and development can help a company improve its production process by increasing efficiency, reducing costs, and enhancing product quality. As a result, it can assist to increase productivity.
Option C, investments in research and development, is most likely to increase productivity.
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is the degree to which decision-making authority is retained at higher managerial levels select one: a. centralization b. specialization c. unification d. formalization
Answer: The degree to which decision-making authority is retained at higher managerial levels is known as centralization. Centralization is the practice of retaining decision-making authority at higher managerial levels, as opposed to decentralization which is the practice of distributing decision-making authority across lower levels of an organization. The other terms in your question (specialization, unification, and formalization) are not related to this concept.
Explanation: The degree to which decision-making authority is retained at higher managerial levels is referred to as Centralization.
This process refers to the extent to which the decision-making power is vested with the top management, and the lower-level employees are not given much control over the decision-making process.
The centralization can be of various forms, and it depends on the size, structure, and the culture of an organization. The degree of centralization varies from organization to organization, and it depends on the nature of the decision being made.
Some of the factors that determine the extent of centralization in an organization are as follows:
Organization's culture and natureSize and nature of the decision-making processSize and nature of the organizationLevel of expertise of the employees involved in the decision-making processThe decision-making process should be designed in such a way that it involves both the top management and the lower-level employees. This process can lead to the success of the organization because it brings different perspectives to the decision-making process.
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the ledger of mai company includes the following accounts with normal balances as of december 31: retained earnings $10,700; dividends $1,650; services revenue $30,000; wages expense $16,900; and rent expense $5,000.
Prepare the necessary closing entries from the available information at December 31.
The necessary closing entries are as follows: Particulars Debit, Credit Income summary account $30,000 Services revenue $30,000 Wages expense $16,900 Rent expense $5,000 Income summary account $21,900 Income summary account $8,100 Retained earnings account $8,100 Dividends account $1,650 Retained earnings account $1,650
In order to prepare the necessary closing entries from the available information at December 31, we must follow certain steps which are as follows:
Step 1: Firstly, we need to transfer the balances of revenue accounts into the income summary account by making a debit entry in the income summary account equal to the total amount of revenue accounts and crediting the total amount of revenue accounts with individual accounts. Here, the revenue account is Services revenue.Particulars Debit Credit Income summary account $30,000 Services revenue $30,000
Step 2: Then, we need to transfer the balances of expense accounts into the income summary account by making a credit entry in the income summary account equal to the total amount of expense accounts and debiting the total amount of expense accounts with individual accounts. Here, the expense accounts are Wages expense and Rent expense.Particulars Debit Credit Wages expense $16,900 Rent expense $5,000 Income summary account $21,900
Step 3: Now, we need to transfer the net income/loss to the retained earnings account by making a credit entry in the income summary account and debiting the retained earnings account. Here, the income summary account has a credit balance of $8,100, which means that the company has net income of $8,100.Particulars Debit Credit Retained earnings account $8,100 Income summary account $8,100
Step 4: Then, we need to transfer the dividends account balance to the retained earnings account by making a debit entry in the retained earnings account and crediting the dividends account.Particulars Debit Credit Dividends account $1,650 Retained earnings account $1,650
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15-a. What is the total cost to be accounted for? 15-b. What is the total cost accounted for? a. $ Total cost to be accounted for Total cost accounted for 357,915 357,915 b. $ Clopack Company manufactures one product that goes through one processing department called Mixing. All raw materials are introduced at the start of work in the Mixing Department. The company uses the weighted average method of process costing. Its Work in Process T-account for the Mixing Department for June follows (all forthcoming questions pertain to June): June 1 balance ? Materials Direct labor Overhead June 30 balance Work in Process-Mixing Department 28,000 Completed and transferred to Finished Goods 151,215 96,500 114,000 ? The June 1 work in process inventory consisted of 4,300 units with $15,240 in materials cost and $12,760 in conversion cost. The June 1 work in process inventory was 100% complete with respect to materials and 60% complete with respect to conversion. During June, 36,800 units were started into production. The June 30 work in process inventory consisted of 9,000 units that were 100% complete with respect to materials and 50% complete with respect to conversion.
The total cost to be accounted for is $357,915 and the total cost accounted for is also $357,915.
The June 1 work-in-process inventory consists of 4,300 units with $15,240 in materials cost and $12,760 in conversion cost, making the total cost of the June 1 inventory $28,000 ($15,240 + $12,760).
During June, 36,800 units were started into production, costing a total of $151,215 ($114,000 for overhead + $37,215 for materials + $0 for direct labor).
The June 30 work-in-process inventory consists of 9,000 units with $18,000 in materials cost and $9,000 in conversion cost, making the total cost of the June 30 inventory $27,000 ($18,000 + $9,000).
Adding together the June 1 and June 30 Work in Process inventory totals gives us the total cost to be accounted for, which is
$357,915 ($28,000 + $151,215 + $27,000 = $357,915).
Since the Completed and Transferred to Finished Goods was the same as the total cost to be accounted for, the total cost accounted for is also $357,915.
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Suppose that Ms. Spencer is currently exhausting her money income by purchasing 10 units of A and 8 units of B at prices of $2 and $4 respectively. The marginal utility of the last units of A and B are 16 and 24 respectively. These data suggest that Ms. Spencer:
a. has preferences that are at odds with the principle of diminishing marginal utility.
b. considers A and B to be complementary goods.
c. should buy less A and more B.
d. should buy less B and more
Ms. Spencer should buy less B and more B (Option c). This is because the marginal utility of A is higher (16) than that of B (24), suggesting that the additional benefit she receives from consuming the next unit of A is greater than the benefit she receives from consuming the next unit of B.
Marginal Utility is the extra utility you receive by consuming one additional unit of any commodity. Marginal utility, according to the principle of diminishing marginal utility, decreases as a person consumes more and more units of a good over time.
Income is defined as the amount of money that a person or household earns in exchange for their labor and services, as well as investments, profits, and other sources. Income is generally used to purchase products that are used to meet people's needs and want.
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Branson Corp. purchased a new machine for its business. The following list shows the various expenditures for the machine during its first year: - Base purchase price,
$50,000
- Sales tax incurred at the time of purchase,
$3,000
- Installation charges for the machine,
$2,000
- Insurance costs incurred while the machine was being shipped,
$200
- Insurance costs for the first year of the machine's service life,
$500
- Ordinary repairs and maintenance costs during the first year of the machine's service life,
$1,200
Question: What should be the capitalized cost of the machine? Do not use symbols or cents in the numerical response. Answer:
$
The capitalized cost of the machine should be 56,900.
Capitalized cost is also called the historical cost of the asset. It is the actual cost of acquiring the asset along with all the necessary expenditures incurred to get the asset ready for use in the production process.
The different expenditures for the machine during its first year include:
The base purchase price, $50,000
Sales tax incurred at the time of purchase, $3,000
Installation charges for the machine, $2,000
Insurance costs incurred while the machine was being shipped, $200
Insurance costs for the first year of the machine's service life, $500
Ordinary repairs and maintenance costs during the first year of the machine's service life, $1,200
The capitalized cost of the machine will be the sum of all the expenditures,
$50,000 + $3,000 + $2,000 + $200 + $500 + $1,200 = $56,900
Thus, the capitalized cost of the machine is $56,900.
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strong property rights are important for modern economic growth because group of answer choices business cycle fluctuations will be smaller and less likely to disrupt investment patterns. they ensure an equitable distribution of income. people are more likely to invest if they don't fear that others can take their returns on investment without compensation they allow governments to extract the gains from private citizens' investments
Strong property rights are important for modern economic growth because people are more likely to invest if they don't fear that others can take their returns on investment without compensation.
What are property rights?Property rights refer to the ownership and control of an economic resource. Ownership provides the right to use the resource as you see fit, while control refers to the right to receive income from the resource. Property rights, in essence, allow for the creation of wealth and incentivize individuals and businesses to use and develop their resources fully.
What is economic growth?Economic growth refers to the increase in the amount of goods and services produced by a country or region over a given period. It is measured by the increase in real GDP, employment, and investment in physical and human capital.The importance of strong property rights for modern economic Growth
Strong property rights are critical to modern economic growth for several reasons.
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true or false the operating plan focuses on how a business plans to meet the goals and objectives contained in the strategic plan.
True, the operating plan focuses on how the business plans to meet the goals and objectives contained in the strategic plan.
What is an operating plan? An operating plan is a business plan that specifies how to implement the strategies, initiatives, and activities described in the strategic plan. It is a tactical plan that outlines the specific actions, timelines, and resources required to accomplish the strategic goals and objectives. It serves as a guide for operational management by outlining how the company will meet its objectives through day-to-day operations.
As a result, it includes the specifics of the company's operations, such as hiring plans, production schedules, sales forecasts, and financial targets. The operating plan and the strategic plan are linked. The operating plan focuses on how a company will put the strategies outlined in the strategic plan into practice. It lays out the specific steps that will be taken to achieve the strategic plan's goals and objectives. They're both important in business planning because the strategic plan outlines what the company wants to accomplish, and the operating plan outlines how it will get there.
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which aspect of preparing an accounting worksheet typically requires the greatest involvement by the accountant?
Adjustments is an aspect of preparing an accounting worksheet typically requires the greatest involvement by the accountant. It is one of the most crucial task of an accountant.
Adjustments are accounting entries made at the end of the accounting period to adjust accounts for the effects of internal and external events that have not been recorded. They are necessary to ensure that the financial statements are accurate and complete.
Adjustments are classified into two types, namely accruals and deferrals. Accruals are revenues or expenses that have been earned or incurred but not yet recorded, while deferrals are revenues or expenses that have been recorded but not yet earned or incurred.
However, it is important to take the time to ensure that the financial statements are accurate, as errors or omissions can lead to serious consequences for the organization, such as legal problems or financial problems.
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The amount a person would have to deposit today to be able to take out $600 a year for 7 years from an account earning 6 percent. (Round time value factor to 3 decimal places and final answer to 2 decimal places.)
The amount that needs to be deposited today to be able to withdraw $600 a year for 7 years at an annual interest rate of 6% is $3,349.43.
We can use the present value formula to calculate the amount that needs to be deposited today to be able to withdraw $600 a year for 7 years at an annual interest rate of 6%:
PV = PMT x (1 - (1 + r)⁻ⁿ) / r
where PV is the present value, PMT is the annual payment, r is the annual interest rate, and n is the number of years.
Substituting the given values, we get:
PV = $600 x (1 - (1 + 0.06)⁻⁷) / 0.06
PV = $3,349.43
Hence, the person needs to deposit $3,349.43
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Constant returns to scale
suggest that a firm's marginal product is declining.
suggest that the firm's marginal cost curve lies above its average cost curve.
accounts for the downward sloping portion of the long run average total cost curve.
account for the upward sloping portion of the long run average total cost curve.
occur when an increase in resources result in a proportional increase in output.
Constant returns to scale occur when an increase in resources results in a proportional increase in output.
What are Constant returns to scale?
Constant returns to scale are a feature of a production system in which an increase in all factors of production leads to a proportionate increase in output. This means that, as all inputs in production are increased by the same factor, output also rises by the same factor. The marginal product remains the same throughout the production process, despite the increase in output. This may be interpreted as the amount of additional output produced by a unit of labor or capital added to the production process.
The long-run average total cost curve slopes downward for constant returns to scale. This suggests that as the size of the production process increases, the per-unit cost of output remains constant. Therefore, we can conclude that constant returns to scale occur when an increase in resources results in a proportional increase in output.
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which of the following best defines confidentiality in context with information and data? group of answer choices the certainty that information is accurate the confirmation that a company will not sell your information to others the ability to limit access to information to a certain set of users the reliability of access to information
Confidentiality refers to the ability to limit access to information to a certain set of users. It ensures that only those with proper authorization can view the data.
This is done to protect the integrity and security of the information and data, as well as ensure that the information is not misused or stolen. Confidentiality is often used in a legal context, such as to protect trade secrets or to ensure the privacy of individuals and businesses.
Confidentiality is key when it comes to sensitive information and data, such as financial records or health records. It is also used in other areas, such as when dealing with private documents or confidential agreements.
Confidentiality is also important when it comes to communication.There are various ways to protect confidential information, such as through the use of secure servers and encryption.
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