Answer:
Below is the required solution.
Explanation:
How can companies influence the crisis in jobs and skills? Nearly 80 case studies show three areas in which businesses can take the lead:
Work with educational and training providers to assist people in developing the skills they need in the world of workSupport startups and smaller companies to promote entrepreneurshipLink talent to markets by bridging the gap between employers and job-seekers.Eight factors that can make programmes and practises more effective also emerge from case studies.
Build multi-sector partnershipsDevelop win-win approachesUnderstand the talent value chainBe relevant to the contextCommit leadership to the causeDesign for the futureLeverage ICTTest first, scale secondOn June 30, Collins Management Company purchased land for $640,000 and a building for $960,000, paying $800,000 cash and issuing a 7% note for the balance, secured by a mortgage on the property. The terms of the note provide for 20 semiannual payments of $40,000 on the principal plus the interest accrued from the date of the preceding payment.a. Journalize the entry to record the transaction on June 30. June 30.b. Journalize the entry to record the payment of the first installment on December 31. Dec. 31.c. Journalize the entry to record the payment of the second installment the following June 30. Assume a 360-day year
Answer:
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You have just deposited $9,000 into an account that promises to pay you an annual interest rate of 6.1 percent each year for the next 7 years. You will leave the money invested in the account and 15 years from today, you need to have $25,650 in the account. What annual interest rate must you earn over the last 8 years to accomplish this goal
Answer:
Annual interest rate = 8.23%
Explanation:
The annual interest rate i must have earn over the last 8 years to accomplish this goal is:
= ((25650/(9000*(1+6.1%)^7))^(1/8))-1
= ((25650/(9000*1.513588))^(1/8)) - 1
= ((25650/13622.29)^(1/8) - 1
= 1.882943323038931^(1/8) - 1
= 1.08231743862 - 1
= 0.08231743862
= 8.231743862%
= 8.23%
Durban Metal Products, Ltd., of the Republic of South Africa makes specialty metal parts used in applications ranging from the cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costing system for internal decision-making purposes. The company has four activity cost pools as listed below: Activity Cost Pool Activity Measure Activity Rate Order size Number of direct labor-hours $ 16.40 per direct labor-hour Customer orders Number of customer orders $ 363.00 per customer order Product testing Number of testing hours $ 71.00 per testing hour Selling Number of sales calls $ 1,488.00 per sales call The managing director of the company would like information concerning the cost of a recently completed order for heavy-duty trailer axles. The order required 180 direct labor-hours, 13 hours of product testing, and 6 sales calls.Required: Prepare a report summarizing the overhead costs assigned to the order for heavy-duty trailer axles. What is the total overhead cost assigned to the order?
Answer:
Total allocated costs= $13,266
Explanation:
To calculate the costs allocated to the order, we need to use the following formula:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Order size= 16.40*180= 2,952
Customer orders= 363*1= 363
Product testing= 71*13= 923
Selling= 1,488*6= 8,928
Total allocated costs= $13,266
Why are marketers sometimes "forced” to reposition their products or services? Il
your answers with examples.
Iar
Explaination
Marketers sometimes forced to reposition their services or products to ensure profitability the company has no other option but to reposition its services or products that would cater to a new target segment of their existing market and ensure sales or profitability.
ReasonThere could be many reasons for marketers repositioning their products.
The products are evolving and getting more features into it. They needs to marketed differently in order to make the customers aware of the new features, add-ons. In this case, it is better to reposition the products.
"All three levels are required to run an organization or a business smoothy"Justify the statement.
Answer:
"All three levels are required to run an organization or a business " according to my point of view it is true without anyone levels (sector) business or organization not imagine to run
At the beginning of the most recent month's operations, finished goods inventory was $30,000. The cost of goods manufactured was $326,000 and ending finished goods inventory was $42,000. What was the cost of goods sold for the month?
Answer:
$314,000
Explanation:
Calculation to determine the cost of goods sold for the month
Finished goods inventory, beginning $30,000
Add: Cost of goods manufactured $326,000
Goods available for sales $356,000
($30,000+$326,000)
Less Finished goods inventory, Ending $42,000
Cost of goods sold $314,000
($356,000-$42,000)
Therefore the cost of goods sold for the month is $314,000
Financial statement data for Delicious Dishes, Inc. are given below. All figures are in dollars. Use this data to construct an Income Statement for the year ending December 31, 2020 and use your constructed statement to answer the following question
Advertising 384,000
Beginning of year inventory 1,243,000
Depreciation 350,000
End of year inventory 1,128,000
General and administrative expenses 1,184,000
Gross sales 28,242,000
Interest expense 150,000
Lease payments 148,000
Management salaries 4,253,000
Purchases 18,243,000
Research and development 324,000
Returns and allowances 564,000
Taxes 925,000
Required:
What was gross profit from income statement for the year ending December 31, 2020?
Answer:
Delicious Dishes, Inc.The gross profit from income statement for the year ending December 31, 2020 is:
= $9,320,000.
Explanation:
a) Data and Calculations:
Advertising 384,000
Beginning of year inventory 1,243,000
Depreciation 350,000
End of year inventory 1,128,000
General and administrative expenses 1,184,000
Gross sales 28,242,000
Interest expense 150,000
Lease payments 148,000
Management salaries 4,253,000
Purchases 18,243,000
Research and development 324,000
Returns and allowances 564,000
Taxes 925,000
Depreciation 350,000
Delicious Dishes, Inc.
Income Statement for the year ending December 31, 2020
Gross sales $28,242,000
Returns and allowances (564,000)
Net sales $27,678,000
Less Cost of Goods Sold:
Beginning of year inventory 1,243,000
Purchases 18,243,000
End of year inventory (1,128,000) $18,358,000
Gross profit $9,320,000
Other Expenses:
Advertising $384,000
General and administrative expenses 1,184,000
Management salaries 4,253,000
Research and development 324,000
Interest expense 150,000
Lease payments 148,000
Total expenses $6,443,000
Profit before taxes 2,877,000
Taxes 925,000
Net income $1,952,000
Disney suffered lawsuits in France, at Disneyland Paris, because of the lack of fit between its transferred personnel policies and the French employees charged to enact them. This is an example of the: Group of answer choices effect of demand conditions. liability of foreignness. risks of a multidomestic strategy. effects of regionalization.
Answer:
liability of foreignness
Explanation:
Liability of foreignness is defined as the cost above what local firms incur that is realised by companies that operate in a foreign country.
This extra cost is influenced by various business environments that exist in the foreign country.
In the given scenario Disneyland Paris is suffering loss through lawsuits because of the lack of fit between its transferred personnel policies and the French employees charged to enact them.
This conflict is giving an extra cost profile which is referred to as liability of foreignness.
A company is evaluating a new 4-year project. The equipment necessary for the project will cost $3,500,000 and can be sold for $715,000 at the end of the project. The asset is in the 5-year MACRS class. The depreciation percentage each year is 20.00 percent, 32.00 percent, 19.20 percent, 11.52 percent, and 11.52 percent, respectively. The company's tax rate is 34 percent. What is the aftertax salvage value of the equipment?
Hint: 1. Find the remaining book value at the end. 2. Subtract this from the expected sale price to find the gain on sale. 3. Apply the tax rate to this gain to find the taxes owed. 4. The after-tax salvage value is the sale price minus the taxes.
a) $715,000.
b) $752,468.
c) $540,444.
d) $677,532.
e) $471,900.
Answer:
d) $677,532.
Explanation:
1.
Written down value of the equipment after 4 years = Cost x ( 100% - 1st year MACRS - Second-year MACRS - Third-year MACRS - Fourth-year MACRS ) = $3,500,000 x ( 100% - 20% - 32% - 19.20% - 11.52% ) = $604,800
2.
Now calculate the gain on the sale of equipment
Gain on the sale of equipment = Sale Price - Written down Value after 4 years = $715,000 - $604,800 = $110,200
3.
Tax owed = Gain on the sale x Tax rate = $110,200 x 34% = $37,468
After-tax salvage value = Sales price - Tax = $715,000 - $37,468 = $677,532
Even though most corporate bonds in the united states make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. suppose a german company issues a bond with a par value of 1000 euros, 23 years to maturity, and a coupon rate of 5.8 percent paid annually.
Required:
If the yield to maturity is 7.5 percent, what is the current price of the bond?
Answer:
Bond Price= 816.29
Explanation:
Giving the following information:
YTM= 0.075
Coupon= 0.058*1,000= 58
Years to maturity= 23 years
Face value= 1,000
To calculate the price of the bond, we need to use the following formula:
Bond Price= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]
Bond Price= 58*{[1 - (1.075^-23)] / 0.075} + [1,000/(1.075^23)]
Bond Price= 626.79 + 189.5
Bond Price= 816.29
What is the loan balance (in dollars) after the third payment, of a 5 year loan of $100,000 with an APR of 10% and annual payments
The Widget Co. can produce widgets according to the formula: q = 5K^3/4 L^1/4 where q is the output of widgets, and K, L are the quantities of capital and labor used.
a. Are there constant, increasing or decreasing returns to scale in widget production? Explain.
b. Are there, constant, increasing or decreasing marginal products of factors? Explain
c. In the short run, the amount of capital used by company A. is fixed. Derive the short-run cost function. (Note that the short-run cost function will show C as a function of Q, K and the factor prices w and r.)
d. Derive the long-run cost function.
Answer:
A) Constant Return to Scale
B) Decreasing Marginal Products
C) Short Run Cost Function = w*(Q/5)4 *(1/K`3) + rK`
D) (2Q/5)*(r3/4)*(w1/4)
Explanation:
A) Q(tL,tK) = 5*(tK)3/4*(tL)1/4
= t*Q(L,K)
Hence it exhibits constant return to scale
B) Here MPK = dQ/dK
= (3/4)* 5*L1/4*K-1/4
So dMPK/dK = (-3/16)*5*L1/4*K-5/4
Hence dMPK/dK < 0
thus exhibits decreasing Marginal Products
(Similarly for Labor also)
C) let K is fixed at K`
So Q = 5*K`3/4*L1/4
So L = (Q/5)4*(1/K`3)
So Short Run Cost Function = w*L + r*K`
C = w*(Q/5)4 *(1/K`3) + rK`
D) in long run, MRTS = MPL / MPK = w/r
So K/L = w/r
Thus rK = wL
So from production function
Q = 5*(wL/r)3/4*L1/4
= 5*(w/r)3/4*L
L* = (Q/5)*(r/w)3/4
similarly K* = (Q/5)*(w/r)1/4
so Long Run Cost Function = wL* + rK*
= (2Q/5)*(r3/4)*(w1/4)
Several years ago, Judy purchased a $1,000 par value corporate bond in the secondary market for $965. Although the bond still has several years until maturity, similar bonds in the marketplace are now selling at a premium with a market price of $1,065. If Judy were to sell her bond, how much, if any, would be treated as a capital gain
Answer: $100
Explanation:
The capita gain is simply the difference between the price that Judy bough the bond at and the price of the bond should Judy decide to sell it now.
Capital gain is therefore:
= Selling price - Buying price
= 1,065 - 965
= $100
Use the selected data from Pinecrest Company's financial statements to answer the following question. 2018 2017 Cash $ 22,000 $ 14,000 Accounts receivable 42,000 16,000 Merchandise inventory 22,000 83,000 Prepaid expenses 23,000 18,000 Total current assets $109,000 $131,000 Total current liabilities $ 65,000 $ 72,000 Net credit sales 221,000 326,000 Cost of goods sold 168,000 299,000 Net cash flow from operating activities 16,000 29,000 Refer to the data for Pinecrest Company. The current ratio for 2018 is
Answer:
1.68
Explanation:
Calculation to determine what The current ratio for 2018 is
Using this formula
Current ratio=Current assets/Current liabilities
Let plug in the formula
Current ratio=$109,000/$65,000
Current ratio= 1.68
Therefore The current ratio for 2018 is 1.68
Makers Corp. had additions to retained earnings for the year just ended of $205,000. The firm paid out $185,000 in cash dividends, and it has ending total equity of $4.90 million. The company currently has 100,000 shares of common stock outstanding.
1. What are earnings per share?2. What are dividends per share? 3. What is the book value per share? 4. If the stock currently sells for $68 per share, what is the market-to-book ratio?5. What is the price-earnings ratio?6. If the company had sales of $3.41 million, what is the price-sales ratio?
Answer:
Waka Waka Wa e e
Explanation:
Queen Shakira
Pick the false statement from below. Multiple Choice Expectations of lower inflation rates in the future tend to lower the slope of the term structure of interest rates. The term structure of interest rates includes both an inflation premium and an interest rate risk premium. The term structure of interest rates and the time to maturity are always directly related. The real rate of return has minimal, if any, effect on the slope of the term structure of interest rates. The interest rate risk premium increases as the time to maturity increases.
Answer: The term structure of interest rates and the time to maturity are always directly related.
Explanation:
The term structure of interest rates shows the relationship between interest rates and the different maturity periods of bonds. Normally, these move in the same direction i.e., the higher the maturity period, the higher the interest rate.
This however is not a given. It might be expected for instance that interest rates might drop in future. In such a situation, the interest might reduce with a longer maturity period which would depict an inverse relationship instead of a direct one.
Botosan Factory has budgeted factory overhead for the year at $717,474, and budgeted direct labor hours for the year are 364,200. If the actual direct labor hours for the month of May are 331,400, the overhead allocated for May is
Answer:
$652,858
Explanation:
Predetermined overhead rate = Budgeted Overheads ÷ Budgeted Activity
= $717,474 ÷ 364,200
= $1.97 per direct labor hour
Allocated overheads = Predetermined overhead rate x Actual Activity
= $1.97 x 331,400 direct labor hours
= $652,858
therefore,
The overhead allocated for May is $652,858.
Presented below is an amortization schedule related to 5-year, $120,000 bond with a 7% interest rate and a 5% yield, purchased on December 31, 2018, for $130,392.
Date Cash Interest Bond Premium Carrying Amount
Received Revenue Amortization of Bonds
12/31/18 $130,392
12/31/19 $8,400 $6,520 $1,880 128,512
12/31/20 8,400 6,426 1,974 126,538
12/31/21 8,400 6,327 2,073 124,465
12/31/22 8,400 6,223 2,177 122,288
12/31/23 8,400 6,112 2,288 120,000
The following schedule presents a comparison of the amortized cost and fair value of the bonds at year-end.
12/31/19 12/31/20 12/31/21 12/31/22 12/31/23
Amortized cost $128,512 $126,538 $124,465 $122,288 $120,000
Fair value $128,000 $128,800 $126,300 $123,500 $120,000
(a) Prepare the journal entry to record the purchase of these bonds on December 31, 2018, assuming the bonds are classified as held-to-maturity securities.
(b) Prepare the journal entry related to the held-to-maturity bonds for 2019.
(c) Prepare the journal entry related to the held-to-maturity bonds for 2021.
(d) Prepare the journal entry to record the purchase of these bonds, assuming they are classified as available-for-sale.
(e) Prepare the journal entries related to the available-for-sale bonds for 2019.
(f) Prepare the journal entries related to the available-for-sale bonds for 2021.
Answer:
A. Dr Held-to-Maturity Securities $130,392
Cr Cash $130,392
B. Dr Cash $8,400
Cr Held-to-Maturity Securities $1880
Cr Interest Revenue $6,520
C. Dr Cash $8,400
Cr Held-to-Maturity Securities $2,073
Cr Interest Revenue $6,327
D. Dr Available-for-Sale Securities $130,392
Cr Cash $130,392
E. Dr Cash $8,400
Cr Available-for-Sale Securities $1,880
Cr Interest Revenue $6,520
Dr Unrealized Holding Gain or Loss--Equity $512
Cr Securities Fair Value Adjustment (Available-for-Sale) $512
F. Dr Cash $8,400
Cr Cr Available-for-Sale Securities $2,073
Cr Interest Revenue $6,327
December 31, 2021
Dr Unrealized Holding Gain or Loss--Equity $427
Cr Securities Fair Value Adjustment (Available-for-Sale) $427
Explanation:
A. Preparation of the journal entry to record the purchase of these bonds on December 31, 2018, assuming the bonds are classified as held-to-maturity securities.
December 31, 2018
Dr Held-to-Maturity Securities $130,392
Cr Cash $130,392
(To record the purchase of these bonds)
B. Preparation of the journal entry related to the held-to-maturity bonds for 2019
December 31, 2019
Dr Cash $8,400
Cr Held-to-Maturity Securities $1,880
Cr Interest Revenue $6,520
(To record held-to-maturity bonds)
C. Preparation of the journal entry related to the held-to-maturity bonds for 2021
December 31, 2021
Dr Cash $8,400
Cr Held-to-Maturity Securities $2,073
Cr Interest Revenue $6,327
(To record held-to-maturity bonds)
D. Prepare the journal entry to record the purchase of these bonds, assuming they are classified as available-for-sale.
December 31, 2018
Dr Available-for-Sale Securities $130,392
Cr Cash $130,392
(To record the purchase of these bonds)
E. Preparation of the journal entries related to the available-for-sale bonds for 2019
December 31, 2019
Dr Cash $8,400
Cr Available-for-Sale Securities $1,880
Cr Interest Revenue $6,520
(To record available-for-sale bonds)
December 31, 2019
Dr Unrealized Holding Gain or Loss--Equity $512
[$128,512 - $128,000]
Cr Securities Fair Value Adjustment (Available-for-Sale) $512
(To record available-for-sale bonds)
F. Preparation of the journal entries related to the available-for-sale bonds for 2021
December 31, 2021
Dr Cash $8,400
Cr Cr Available-for-Sale Securities $2,073
Cr Interest Revenue $6,327
(To record available-for-sale bonds)
December 31, 2021
Dr Unrealized Holding Gain or Loss--Equity $427
Cr Securities Fair Value Adjustment (Available-for-Sale) $427
($126,300 - $124,465) - ($128,800 - $126,538)
=($1,835-$2,262=$427)
(To record available-for-sale bonds)
During 2019, $27,000 of cash dividends were declared and paid. A patent valued at $80,000 was obtained in exchange for land. Equipment that originally cost $20,000 and had $7,000 accumulated depreciation was sold for $13,000 cash. Bonds payable were sold for cash and cash was used to pay for structural improvements to the building. Required a. Compute the change in cash that occurred during 2019. b. Prepare a statement of cash flows using the indirect method
Answer:
a. Change in Cash that occurred during 2019:
Cash outflow $27,000
Cash inflow = $13,000
Net outflow = $14,000
b. Statement of Cash Flows for the year ended December 31, 2019:
Investing activities:
Sale of Equipment $13,000
Financing activities:
Payment of dividends ($27,000)
Net cash outflow = $14,000
Explanation:
a) Data and Calculations:
Cash dividends paid during 2019 = $27,000
Patent purchased = $80,000
Land sold in exchange of patent = $80,000
Sale of equipment = $13,000
Sales of Bonds Payable = Cost of Building Improvements
Rosalia White will invest $3,000 in an IRA for the next 30 years starting at the end of this year. The investment will earn 13 percent annually. How much will she have at the end of 30 years
Answer:
$879,597.65
Explanation:
The future value of an ordinary annuity formula is applicable in this case, since an ordinary annuity is such that payments into the accounts are expected to occur at the end of the periods rather than at the beginning of each year:
FV=yearly payment*(1+r)^n-1/r
yearly payment=$3,000
r=13%
n=number of annual payments =30
FV=$3000*(1+13%)^30-1/13%
FV=$3000*(1.13)^30-1/0.13
FV=$3000*(39.11589796-1)/0.13
FV=$3000*38.11589796/0.13
FV=$879,597.65
Here is some price information on Fincorp stock. Suppose first that Fincorp trades in a dealer market. Bid Asked 55.25 55.50 a. Suppose you have submitted an order to your broker to buy at market. At what price will your trade be executed? (Round your answer to 2 decimal places.) b. Suppose you have submitted an order to sell at market. At what price will your trade be executed? (Round your answer to 2 decimal places.)
Answer:
a. Your trade will be executed at the bid price of 55.25.
b. Your trade will be executed at the ask price of 55.50.
Explanation:
First note that:
The bid price is the highest price a buyer will pay for a security.
The ask price is the lowest price a seller will accept for a security.
Therefore, we have:
a. Suppose you have submitted an order to your broker to buy at market. At what price will your trade be executed? (Round your answer to 2 decimal places.)
Since you are the buyer, your trade will be executed at the bid price of 55.25. This is because the bid price is the highest price you as a buyer will pay for a security.
b. Suppose you have submitted an order to sell at market. At what price will your trade be executed? (Round your answer to 2 decimal places.)
Since you are the seller, your trade will be executed at the ask price of 55.50. This is beecausee the ask price is the lowest price uou as a seller will accept for a security.
You purchased a 20-year par value bond with semiannual coupons at a nominal annual rate of 8% convertible semiannually at a price of 1722.25. The bond can be called at par value X on any coupon date starting at the end of year 15 after the coupon is paid. The price guarantees that you will receive a nominal annual rate of interest convertible semiannually of at least 6%. Calculate X.
a. 1400
b. 1420
c. 1440
d. 1400
e. 1480
Answer:
1400
Explanation:
The concept par value bond refers to a bond that may be redeemed for its face value. From the coupon nominal annual rate of 8%, it means the coupon is 4% for half of the year is higher than the effective yield of 3% for 6 month period. As such, the bond sells at a higher premium price.
As a result, the minimum yield rate that contributes to the potential of the bond being called is computed at the initial conceivable call date, which is precisely 15 years after the date of purchase, because it is the most unfavorable period for the bondholder if the call occurs. As a result, the par value X fulfills the following condition:
[tex]1722.25 = 0.04*X*a_{|30|3\%|}+\dfrac{X}{1.03^{30}}[/tex]
Making X the subject:
[tex]X = \dfrac{1722.25}{0.04*a_{|30|3\%|}+1.03^{-30}}[/tex]
Using financial Calculator:
X = 1400.01
X ≅ 1400
A manager hires labor and rents capital equipment in a very competitive market. Currently the wage rate is $7 per hour and capital is rented at $11 per hour. If the marginal product of labor is 65 units of output per hour and the marginal product of capital is 55 units of output per hour, should the firm increase, decrease, or leave unchanged the amount of capital used in its production process
Answer:
leave unchanged
Explanation:
because it doe snore jobs then the other one
Jenny Manufactures sold toys listed at $360 per unit to Jack Inc. for $306, a trade discount of 15 percent. Jack Inc. in turn sells the toys in the market at $335. Jenny should record the receivable and related sales revenue (per unit) at: Group of answer choices $360 $335 $306 $285
Answer:
$306
Explanation:
Based on the information given Jenny should record the receivable and related sales revenue (per unit) at $306 reason been that we were told JENNY MANUFACTURES SOLD TOYS THAT WAS LISTED AT THE AMOUNT OF $360 PER UNIT TO JACK INC. FOR THE AMOUNT OF $306.
Hence, Jenny will record the RECEIVABLE AND RELATED SALES REVENUE (per unit) at $306.
A student organization is developing promotions for its clothing fundraiser. Email blasts across campus will be part of the campaign. The following are subject line features that might explain whether promotional emails are opened: the number of words in the subject line using the recipient’s name in the subject line including humor in the subject line posing a question in the subject line including the name of a well-known community member What type of model could the student group utilize to analyze which features are important for explaining whether someone opens a promotional email
Answer: Logistic regression
Explanation:
The type of model that the student group can utilize to analyze which features are important for explaining whether someone opens a promotional email is the logistic regression.
Logistic regression is the regression analysis that's used to conduct in a case whereby the dependent variable is binary.
With regards to the question, the logistic regression can provide the best model which will be used to forecast the most important features for the opening of the promotional e-mail.
MC algo 8-18 Valuing Stock Asonia Co. will pay a dividend of $5.10, $9.20, $12.05, and $13.80 per share for each of the next four years, respectively. The company will then close its doors. If investors require a return of 9.4 percent on the company's stock, what is the stock price?
a. $3708
b. $32.88
c. $42.38
d. $3119
e. $35.41
Answer:
d. $31.19
Explanation:
The computation of the stock price is shown below
Stock Price is
= [$5.10 ÷ (1 + 0.094)^1 + $9.20 ÷ (1 + 0.094)^2 + $12.05 ÷ (1 + 0.094)^3 + $13.80 ÷ (1+0.094)^4]
= $4.66 + $7.69 + $9.20 + $9.63
= $31.19
hence, the option d is correct
The new office supply discounter, Paper Clips, Etc. (PCE), sells a certain type of ergonomically correct office chair. The annual holding cost per unit is $25, annual demand is 180,000 chairs, and the ordering cost is $150 per order. The lead time is 5 days. Because demand is variable (standard deviation of daily demand is 30 chairs), PCE has decided to establish a customer service level of 96%. The store is open 300 days per year.
Required:
a. What is the optimal order quantity?
b. What is the safety stock?
c. What is the reorder point?
d. What is the optimal annual total inventory cost?
Solution :
Given data:
Annual demand, D = 180,000 chairs
Ordering cost, F = $ 150 per order
Annual holding cost per unit, C = $25
Lead time of order, L = 5 days
Standard deviation of order during lead time = 30
a). The optimal order quantity
[tex]$=\sqrt{\frac{2FD}{C}}$[/tex]
[tex]$=\sqrt{\frac{2\times 150 \times 180,000 }{25}}$[/tex]
= 1469.69
= 1470 (rounding off)
b). The Z value of the customer service of 90%,
i.e., the probability of 0.90 as per normal distribution table = 1.29
∴ Safety stock = Z value x standard deviation of order during lead time
= 1.29 x 30
= 38.7
= 39 (rounding off)
c). The reorder point
[tex]= \text{Average demand per day} x \text{Demand lead time (day) + Safety stock}[/tex]
[tex]$=\frac{\text{annual demand}}{\text{300 days}} \times \text{ Demand Lead time (days) + Safety stock}$[/tex]
[tex]$=\frac{180,000}{300} \times 5 + 39$[/tex]
= 3039
d). The optimal annual total inventory cost
[tex]$\text{= Annual ordering cost + Annual Inventory carrying cost}$[/tex]
[tex]$\text{= Number of orders} \times \text{Ordering cost + Average inventory} \times }$[/tex] [tex]$\text{Inventory holding cost per unit per year}$[/tex]
[tex]$=\frac{\text{annual demand}}{\text{optimum order quantity}} \times \text{ordering cost+}\frac{\text{optimum ordering cost}}{2}\times C$[/tex]
[tex]$=\frac{180,000}{1470} \times 150 + \frac{1470}{2} \times 25$[/tex]
= 18367.34 + 18375
= $ 36,742.34
XYZ Tile Installation Corporation measures its activity in terms of square feet of tile installed. Last month, the budgeted level of activity was 1,180 square feet and the actual level of activity was 1,270 square feet. The company's owner budgets for supply costs, a variable cost, at $3.50 per square foot. The actual supply cost last month was $4,980. What would have been the spending variance for supply costs
Answer:
The appropriate solution is "$535 U". A further explanation is described below.
Explanation:
The given values are:
Actual level of activity,
= 1270
Budgeted variable cost,
= $3.50
Actual supply cost,
= $4980
Now,
The spending variance for supply costs will be:
= [tex](Actual \ level \ of \ activity\times Budgeted \ variable \ cost)\times Actual \ supply \ cost[/tex]
= [tex](1270\times 3.50)-4980[/tex]
= [tex]4445-4980[/tex]
= [tex]535[/tex] (unfavorable)
Standard and actual costs for direct materials for the manufacture of 1,000 units of product were as follows:
Actual costs 1,550 lbs. at $9.10
Standard costs 1,600 lbs. at $9.00
Determine the (a) quantity variance, (b) price variance, and (c) total direct materials cost variance. Enter favorable variances as negative numbers.
a. Quantity variance $______
b. Price variance $______
c. Total direct materials cost variance
Answer and Explanation:
The computation is shown below;
a.
Materials quantity variance is
= (Actual quantity used × Standard price) - (Standard quantity allowed × Standard Price)]
= (1550 × 9.00) - (1600 × 9.00)
= $(450.00)
= $450 favorable
b.
Direct materials price variance is
Materials Price Variance = (Actual quantity purchased × Actual price) - (Actual quantity purchased × Standard price)
= (1550 × 9.10) - (1550 ×$9.00)
= $155
= $155 unfavorable
c.
Total direct materials cost variance is
= Materials quantity variance + Direct materials price variance
= -$450 + $155
= -$295
= $295 Favorable
How does your new budget help you to meet your long-term goal of saving for college?
Answer:
make sure in the budget your savings are enough for college in the time you want
that is the expenditure must not over wegh the income...you should save as much as possible
Answer:
A budget helps create financial stability.
Explanation:
Why is budgeting crucial for college students?Budgeting assists you in achieving your academic and financial objectives.
A budget will also assist you in anticipating unforeseen costs and challenges. Budgeting necessitates difficult decision-making, but creating goals will make the process easier.
How can Budgeting helps individual?A budget aids in financial security A budget makes it simpler to pay bills on time, develop an emergency fund, and save for significant purchases like a car or home by tracking costs and sticking to a plan. A budget, in general, puts a person on a better financial footing in the short and long term.Goal of Budget-A budget is used to plan, manage, track, and improve one's financial status. In other words, a budget keeps you on track toward your long-term financial goals by allowing you to regulate your spending and consistently save and invest a percentage of your income.
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