Answer:
the minimum estimated value of the synergistic benefits from the merger is $22 million
Explanation:
The computation of the minimum estimated value of the synergistic benefits from the merger is given below:
= Holmes Offered value in cash - watson worth
= $215 million - $193 million
= $22 million
Hence, the minimum estimated value of the synergistic benefits from the merger is $22 million
A rules-based monetary policy :_______.a. is advocated by activists. b. is advocated by nonactivists. c. could involve a predetermined steady growth rate in the money supply. d. b and c e. all of the above
Answer:
d. b and c
Explanation:
Monetary policy can be defined as the actions (macroeconomic policies) adopted and undertaken by the central bank of a particular country (Federal Reserve System in the United States of America) to control the money supply and interest rates so as to boost or enhance economic growth.
Basically, monetary policies are used by the central bank to manage inflation, economic growth through long-term interest rates and level of unemployment in a country. In order to boost economic growth, the national government through its central bank introduces monetary policy to increase money supply (liquidity). Also, a monetary policy can be used to prevent inflation through the reduction of money supply at a given period of time.
A rules-based monetary policy is advocated by non-activists and when it's adopted by the central bank of a country, it could involve a predetermined steady growth rate in the money supply because it's implemented based on specific indicator events existing in the economy.
Below is the production possibilities frontier for Japan. It shows that Japan is able to produce either 80 bottles of milk or 50 cartons of eggs using all of its available resources. Also suppose that Japan decides to produce at point A : 60 bottles of milk and 12 cartons of eggs. If Japan engages in international trade and trades 30 bottles of milk for 30 cartons of eggs with another country, it will be able to consume outside of its production possibilities frontier. How many bottles of milk will the country have at the end of the exchange
Answer and Explanation:
The computation of the number of bottle of milk will the country at the end of the exchange is shown below:
The Number of milk bottles Japan is presently producing is 60 bottles
The Number of milk bottles Japan trades with another country is 30 bottles
So,
The Number of Milk bottles left with Japan after doing an exchange is
= 60 - 30
= 30 bottles
Also,
The Number of egg cartons Japan is presently producing is 12
The Number of egg cartons Japan trades with another country is 30
So,
Number of eggs cartons left with Japan after considering an exchange is
= 12 + 30
= 42 cartons
Some of your senior employees have started changing important information in a new call script. Newer employees have noticed, and some have started doing the same. What would you do? Select all that apply.
A Allow the senior employees to go off script since they have more experience
B Practice using the new script during your weekday team meeting
C Discipline those who don't follow the script
D Give written warnings to the senior employees
E Require all of the newer employees attend additional training
Give written warnings to the senior employees
Borges Machine Shop, Inc., has a 1-year contract for the production of 225,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost data follow:
General-Purpose Equipment (GPE) Flexible Manufacturing System (FMS) Dedicated Machine (DM)
Annual contracted units 225,000 225,000 225,000
Annual fixed cost $125,000 $225,000 $480,000
Per unit variable cost $15.00 $14.00 $13.00
The option GPE is best when the contracted volume is below:__________
Answer:
For 225,000 units FMS is the best alternative.
For GPE: TC
GPE
[tex]= $100,000 + ($15.00\times 225,000)\\\\= $3,475,000[/tex]
For 0 units GPE has the lowest TC. The next lowest cost is FMS.
x = ($200,000-$100,000)/($15-$14) = 100,000
Therefore, for 0 to 100,000 units GPE is the best alternative.
Explanation:
Formula used:-
For 225,000 units FMS is the best alternative.
Total Cost (TC) = Fixed Cost (FC) + [Variable Cost (VC) x Annual Contract Units (ACU)]
For GPE: TC
GPE
[tex]= $100,000 + ($15.00\times 225,000)\\\\= $3,475,000[/tex]
For FMS: TC
FMS
[tex]= $200,000 + ($14.00\times 225,000)\\\\= $3,350,000[/tex]
For DM: TC
DM
[tex]= $480,000 + ($13.00 \times225,000)\\\\= $3,405,000[/tex]
For 0 units GPE has the lowest TC. The next lowest cost is FMS. Comparing these two plans, let x be the no of units when the cost of both plans is the same.
x = ($200,000-$100,000)/($15-$14) = 100,000
Therefore, for 0 to 100,000 units GPE is the best alternative
Similarly comparing FMS and DM to find x, we get
x= ($ 480,000-$ 200,000)/($14-$13) = 280,000
So, for the 225,000 and 280,000 range, FMS is the best alrernative.
For greater than 280,000 DM is the best alternative.
The option GPE is best when the contracted volume is below 100,000 units
The option FMS is best when the contracted volume is between 100,000 and 280,000 units (enter your response as a whole number)
The option DM is best when the contracted volume is over 280,000 units (enter your response as a whole number)
please someone should help me.....how do we solve the square root of x +8 plus the square root of x+1 equals 7.....note the question is a surd question
The solution to the surd equation here is x = 449/49
How to solve for the value of the surd[tex]\sqrt{x+8} +\sqrt{x-1} = 7[/tex]
We have to isolate the surds
[tex]\sqrt{x+8} =\sqrt{x-1} +7[/tex]
Square the both sides of the equation
x+8 = x-1+49-14√x-1
Separate the equations on the left and the right hand side
14√x-1 = -x-8+x-1+49
Rearrange the equation
14√x-1 = 40
square the both sides of the equation such that
196x -1796 = 0
Divide through by 196
x = 1796/196
x = 449/49
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Park uses a perpetual inventory system. Determine the cost assigned to ending inventory and to cost of goods
sold using (a) specific identification, (b) weighted average, (c) FIFO, and (d) LIFO. (Round per unit costs to
three decimals, but inventory balances to the dollar.) For specific identification, ending inventory consists of
225 units, where 90 are from the March 30 purchase, 80 are from the March 20 purchase, and 55 are from
beginning inventory.
Answer:
below
Explanation:
The price attributed to final inventory and cost of goods sold is specific identification.
Explain about the specific identification?The method of precise identification concerns inventory valuation, specifically keeping track of each individual stock item and allocating costs per item rather than collectively. A company is functional and usable when it can identify, mark, and keep track of each item or unit in its inventory.
To track individual inventory items, the specific identification method is used. When individual items can be clearly identified, such as when they have a serial number, stamped receipt date, bar code, or RFID tag, this method is appropriate.
Employed by businesses like furniture shops, car dealerships, jewellery shops, and art galleries, among others. The main characteristic that sets the specific identification method apart from LIFO and FIFO techniques is individual tracking.
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Alpha and Beta, two tiny islands in the Pacific, produce pearls and pineapples. The following production possibilities schedules describe their potential output in tons per year:
ATTACHMENT IS BELOW
Suppose Alpha and Beta agree that the terms of trade will be one for one and exchange 10 pearls for 10 pineapples.
a. If Alpha produced 6 pearls and 15 pineapples while Beta produced 30 pearls and 8 pineapples before they decided to trade, how many pearls would each be producing after trade? Assume that the two countries specialize according to their comparative advantage.
(i) Alpha: _____ pearls
(ii) Beta: _____ pearls
b. How much would the combined production of pineapples increase for the two islands due to specialization?
_____ pineapples
c. How much would the combined production of pearls increase?
_____ pearls
d. What is the post-trade consumption for each island?
Alpha consumes _____ pearls and ______ pineapples.
Beta consumes ______ pearls and ______pineapples.
Answer:
The opportunity cost of pearls for A is 2.5 pineapples and the opportunity cost of pearls for A is 0.27.
Explanation:
If Alpha produced 6 pearls and 15 pineapples, while B produced 30 pearls and 8 pineapples before the trade, we can calculate the opportunity cost for each island. For island Alpha, their opportunity cost will be:
6 pearls = 15 pineapples
1 pearl = 15/6 pineapples
1 pearl = 2.5 pineapples
Therefore, the opportunity cost of pearls for A is 2.5 pineapples
For island Beta, their opportunity cost will be:
30 pearls = 8 pineapples
1 pearl = 8/30 pineapples
1 pearl = 0.27 pineapples
Therefore, the opportunity cost of pearls for A is 0.27 pineapples
b)
It appears that A will increase production of pineapples from 15 pineapples to 25 pineapples, and due to their opportunity cost, will decrease pearl production from 6 pearls to 2 pearls
It appears that B will increase the production of pearls from 30 pearls to 40 pearls, and due to their opportunity cost, will decrease pineapple production from 8 pineapples to 4 pineapples.
Use this information for Mason Corporation to answer the question that follow. Mason Corporation had $1,114,000 in invested assets, sales of $1,281,000, income from operations amounting to $209,000, and a desired minimum return of 15%. Round your answer to two decimal places. The investment turnover for Mason Corporation is a.1.38 b.1.15 c.1.72 d.0.92
Answer:
b.1.15
Explanation:
The computation of the investment turnover is shown below:
= Sales ÷ average operating assets
= $1,281,000 ÷ $1,114,000
= 1.1499
= 1.15
hence, the investment turnover is 1.15
Therefore the option b is correct
The same should be considered and relevant
Using the data below for Ace Guitar Company: Region A Region B Sales $786,500 $643,500 Cost of goods sold 298,900 244,500 Selling expenses 188,800 154,400 Service department expenses Purchasing $240,200 Payroll accounting 160,200 Allocate service department expenses proportionally to the sales of each region, determine the divisional income from operations for the Regions A and B. For interim calculations, round the percentages to one decimal place. Region A $fill in the blank 1 Region B $fill in the blank 2
Solution :
Calculation of income from operations
Sales Region A Region B
Cost of goods sold 643,500 786,500
Selling expenses 244,500 298,900
Service department expenses 154,400 188,800
Purchasing (working note - 1) 108,090 132,110
Payroll accounting (working note - 2) 72,090 88,110
Income from expenses $ 64,420 $ 78,580
Working note 1
Allocation of purchasing expenses:
A region = [tex]$240,200 \times \frac{643500}{(643500+786500)}$[/tex]
= $ 108,090
B region = [tex]$240,200 \times \frac{786500}{(643500+786500)}$[/tex]
= $ 132,110
Working note 2
Allocation of payroll accounting expenses.
A region = 160200 x 0.45 (sales ratio)
= $ 72,090
B region = 160,200 x 0.55 (sales ratio)
= $ 88,110
PART A. MULTIPLE CHOICE - 15 MARKS
1. Company orientation does not include which topic below?
Economic Factors
b. Fringe Benefits
C. Occupational Health and Safet
d. None of the above
what is the answer?
Answer: a. Economic factors
Explanation:
Company orientation refers to training that is given to new employees to better prepare them to work in the company and be as efficient as possible.
It includes things like occupational health and safety so that the employee may know how best to behave so as not to cause accident or get injured by one. It also includes telling the employees of the various fringe benefits that might accrue to them.
It would not include economic factors as these as not specific to the company.
On January 1, 2019, Loeffler Company acquired a machine at a cost of $200,000. Loeffler estimates that it will use the machine for 4 years or 8,000 machine hours. It estimates that after 4 years the machine can be sold for $20,000. Loeffler uses the machine for 2,100 and 1,800 machine hours in 2019 and 2020, respectively.
Required:
Compute depreciation expense for 2019 and 2020 using the () straight-line, (2) double- declining-balance, and (3) units-of-production methods of depreciation
Answer:
1. $45,000
$45,000
2. $100,000
$50,000
3. $47250
$40,500
Explanation:
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
($200,000 - $20,000) / 4 = $45,000
Depreciation expense each year would be $45,000
Depreciation expense using the double declining method = Depreciation factor x cost of the asset
Depreciation factor = 2 x (1/useful life) = 2/4 = 1/2
Depreciation expense in 2019 = 1/2 x 200,000 = $100,000
Book value in 2020 = 200,0000 - 100,000 = 100,000
Depreciation expense in 2019 = 1/2 x 100,000 = 50,000
Activity method based on hours worked = (hours worked that year / total hours of the machine) x (Cost of asset - Salvage value)
2019 = ($200,000 - $20,000) x ( 2,100 / 8000) = 47250
2020 = ($200,000 - $20,000) x ( 1800 / 8000) = 40,500
Why irish lions rugby playing with Japan?
Answer:
I expect the answer in the following form
Explanation:
Irish lions play with Japan to get better and learn new things
ne implication from the evidence on EI to date is that employers should consider it a factor in hiring employees, especially in jobs that demand ________. good mathematical skills good critical thinking skills good analytical skills the ability to work independently a high degree of social interaction
Answer:
a high degree of social interaction
Explanation:
Emotional intelligence can be regarded as "emotional quotient" It is been defined as the ability to understand as well as to use and manage one's emotions in positive ways so that individual can be relieve of stress or communicate effectively with others or express empathize with others. With Emotional intelligence individual can overcome challenges as well as defusing conflict. Emotional intelligence (EI) can be regarded as concept which is moderately correlated with job performance.
Components of Emotional intelligence are;
✓Social skills.
✓Self-awareness.
✓Motivation.
✓Empathy.
✓Self-regulation.
It should be noted that One implication from the evidence on EI to date is that employers should consider it a factor in hiring employees, especially in jobs that demand a high degree of social interaction.
Suppose the corrective tax policy and the number of pollution permits available do not change in spite of this demand shift. As a result of the technology change, the price of pollution will change under , and the quantity of pollution will change under
Answer:
As a result of the technology change, the price of pollution will be same as price of pollution with pollution permits.
The quantity of pollution with corrective tax will be lower than quantity of pollution with pollution permits.
Explanation:
The pollution permits are issued to reduce pollution by firms. The companies will reduce the pollution and will only be able to emit pollution up to certain limit. The price of pollution with corrective tax will be same as the price of pollution with pollution permits.
what is the effect on the market when suppliers under invest in their business
The Johnson Robot Company’s marketing managers estimate that the demand curve for the company’s robots in 2012 is P = 6,000 - 40Q where P is the price of a robot and Q is the number sold per month. If the firm wants to maximize its dollar sales volume, what price should it charge?
The Metropolitan Bus Company (MBC) purchases diesel fuel from American Petroleum Supply. In addition to the fuel cost, American Petroleum Supply charges MBC $225 per order to cover the expenses of delivering and transferring the fuel to MBC's storage tanks. The lead time for a new shipment from American Petroleum is 10 days; the cost of holding a gallon of fuel in the storage tanks is $0.03 per month, or $0.36 per year; and annual fuel usage is 180,000 gallons. MBC buses operate 288 days a year.
Required:
a. What is the optimal quantity for MBC?
b. How frequently should MBC order to replenish the gasoline supply?
c. The MBC storage tanks have a capacity of 15,000 gallons. Should MBC consider expanding the capacity of its storage tanks?
d. What is the recorder point?
Answer:
A. 15,000
B. 12 times
C. No Need Of Expanding the storage tanks
D. 6,250 gallons
Explanation:
a. Calculation to determine the optimal quantity for MBC
Using this formula
Optimal quantity=√2×Demand quantity×Ordering cost÷Holding cost
Let plug in the formula
Optimal quantity=√2×180,000×$225÷$0.36
Optimal quantity=√225,000,000
Optimal quantity=15,000
Therefore the optimal quantity for MBC is 15,000
b. Calculation to determine How frequently should MBC order to replenish the gasoline supply
Using this formula
MBC order=Demand quantity÷ Economic Ordering quantity
Let plug in the formula
MBC order=180,000÷15,000
MBC order=12 times
Therefore How frequently should MBC order to replenish the gasoline supply will be 12 times
c.) If The MBC storage tanks have a capacity of 15,000 gallons there is NO NEED OF EXPANDING the storage tanks reason been that the OPTIMAL ORDER QUANTITY is 15,000 which is the same with MBC's tank storage capacity.
d. Calculation to determine the reorder point
Using this formula
Reorder point = Lead time× Average demand quantity
Where,
Lead time=10 days
Average Demand Quantity=180,000/$288
Average Demand Quantity=625
Let plug in the formula
Reorder point =10 days*625
Reorder point=6,250 gallons
Therefore Reorder point is 6,250 gallons
lamingos, Inc. has two service departments and two operating (production) departments. Administrative Department costs are allocated to the Assembly and Packaging departments based on the number of employees, and Maintenance Department costs are allocated to the Assembly and Packaging departments based on square feet occupied. Data for these departments follows:
Department Direct Expenses No. of employees Sqaure Feet
Administrative $30,000
Maintenance 15,000
Assembly 70,000 6 2,000
Packaging 45,000 4 3,000
The total amount of the Administrative Department's cost that would eventually be allocated to the Packaging Department is: __________
Answer:
Packaging= $12,000
Explanation:
First, we need to calculate the allocation rate of the Administrative Department:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Allocation rate= 30,000 / (6 + 4)
Allocation rate= $3,000 per employee
Now, we can allocate to the Packaging Department:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Packaging= 3,000*4
Packaging= $12,000
Wydex stock is currently trading at $82 a share. The firm feels that its primary clientele can afford to spend between $2,000 and $2,500 to purchase a round lot of 100 shares. The firm should consider a:
Answer: Stock Split
Explanation:
The company should consider a stock split which would enable it to reduce the price of its stock but without changing total shareholder value.
With a stock split, the companies stock would be divided into smaller stocks that would have a lower price but when all these are added up, the total shareholder value would not change.
Right now the stock is trading at $82 per share. If they could do a stock split such that each stock is between $20 and $25 then people would be able to spend between $2,000 and $2,500 to purchase a round lot of 100 shares.
A restaurant offers a 20% discount on all meals for people aged 60 and older. This restaurant is practicing:_________
a. monopolistic competition.
b. efficient pricing.
c. reservation pricing.
d. price discrimination.
e. price retention.
Answer:
d
Explanation:
Price discrimination is when the same product is sold at different prices to customers in different markets
types of price discrimination
1. first degree price discrimination : here sellers charge each consumer at their willingness to pay in order to eliminate consumer surplus.
2. second degree price discrimination : here firms offer different prices depending on the quantity purchased. e.g. giving discounts for bulk purchases.
3, third degree price discrimination : firms charge different prices to different groups of customers. e.g. having a certain price for senior citizens, students
Requirements to practice successful price discrimination
1. The firm must have market power. If the firm does not have market power and attempts to price discriminate they would lose customers
2. The firm must have different elasticities of demand for their product in different markets
3. The firm must be able to segment the market for their products
The restaurant who offers a 20% discount on all meals for people aged 60 years and above is practicing price discrimination.
Price discrimination can be defined as a situation in which the producer charges different prices for different groups of customers buying the same product.This means, all customers be are purchasing the bc same commodity but are charged differently by the producer.Therefore, the restaurant is practicing price discrimination system
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Your mayor just announced that the local unemployment rate dropped from 10.5% to 10.4% from the prior month. Evaluate the unemployment rate drop and discuss whether there is enough information to determine significance. Support your response with specific examples. In replies to peers, discuss whether you agree or disagree with their assessments and justify your response
Answer:
Not enough information
Explanation:
from this question, this mayor has only given us the estimated proportion of the rate of unemployment for these months. In order to know if it is significant or not, we have to carry out other tests such as the hypothesis testing for the population proportion. But here we do not have any sample data or population data with which we can use to test this significance. The sample size is unknown so we cannot proceed to test if the claim is significant or not.
RST Company produces a product that has a variable cost of $6 per unit. The company's fixed costs are $30,000. The product sells for $10 per unit. The break-even point in sales dollars is $_____________.
Answer: $75000
Explanation:
In order to solve the question, firstly we need to calculate the contribution margin ratio which will be:
= ($10 - $6) / $10
= 40%
Then, the break even sales will then be:
= Fixed cost / Contribution margin ratio
= $30000 / 40%
= $75000
Therefore, the break-even point in sales dollars is $75000
A broker represents a seller and has an office policy of acting as an intermediary. A sponsored sales agent brings in a buyer who wishes to purchase one of the broker's listings. The buyer wishes to remain unrepresented. What is the BEST choice available to the broker in this case
Answer: The broker should continue to represent the seller and treat the buyer as a customer.
Explanation:
From the information given, we are informed that a broker represents a seller and has an office policy of acting as an intermediary, then a sponsored sales agent brings in a buyer who wishes to purchase one of the broker's listings.
Since the buyer wishes to remain unrepresented, then the broker should continue to represent the seller and treat the buyer as a customer.
Four fundamental factors affect the cost of money:
1. The return that borrowers expect to earn on their investments
2. The preference of savers to spend their income in the current period rather than delay their consumption until some future period
3. The risks associated with the investment
4. Expected inflation
Consider the following statements that address these factors, and indicate if you think each statement is true or false.
Statement
True
False
Investments providing cash flows that are more likely to equal their expected value are said to exhibit more risk.
The actual relationship between the risk-free rate of return (r*r*) and the expected future inflation rate or inflation premium (IP) is actually multiplicative—that is, [(1 + rRFrRF) x (1 + IP)] – 1—but it is often simplified to reflect an additive relationship.
All things being equal, rational savers and investors prefer to invest in an asset that provides a 12% return rather than one that provides an 8% return.
All things being equal, savers and investors prefer more risk to less risk and prefer lower risk premiums on projects exhibiting higher levels of risk.
On average and everything else held constant, an investment that can provide a 4% return should attract more investment capital from savers/investors than an otherwise identical investment that can generate a 12% return.
Answer:
True statement is:
All thing being equal, savers and investors prefer more risk to less risk and prefer lower risk premiums on projects exhibiting higher levels of risk.
Explanation:
Investors wish to receive less risk and more return. They prefer from more risk to lesser risk and receive risk premium on project that exhibit higher level of risk and delayed compensation. A project with 12% return will be more riskier than a project with 8% return. Rate of return increases as the level of risk increases.
Select the correct point on the graph. Which point on the graph indicates the lowest quantity supplied of goods?
Answer:
Point A
Explanation:
The supply curve given above shows the correlation between the cost of goods (on the vertical axis) and quantity of goods supplied (on the horizontal axis).
From the graph, we can see that as the price of the goods increases, the quantity that is supplied in pounds also increases, and vice versa.
The lowest price correlates with the lowest quantity supplied. Therefore, at point A on the graph, we have the lowest quantity supplied of goods.
Sunland Company took a physical inventory on December 31 and determined that goods costing $200,000 were on hand. Not included in the physical count were $24,840 of goods purchased from Pelzer Corporation, f.o.b. shipping point, and $21,960 of goods sold to Alvarez Company for $30,630, f.o.b. destination. Both the Pelzer purchase and the Alvarez sale were in transit at year-end. What amount should Sunland report as its December 31 inventory
Answer:
$246,800
Explanation:
Calculation to determine What amount should Sunland report as its December 31 inventory
Using this formula
Ending inventory = Inventory count as per physical count + Inventory in transit FOB Shipping point (Purchases) + Inventory in transit FOB destination (Sales)
Let plug in the formula
Ending inventory= $200,000 + $24,840+ $21,960
Ending inventory= $246,800
Therefore What amount should Sunland report as its December 31 inventory is $246,800
Martin Company manufactures a powerful cleaning solvent. The main ingredient in the solvent is a raw material called Echol. Information concerning the purchase and use of Echol follows:
Purchase of Echol Echol is purchased in 15-gallon containers at a cost of $115 per container. A discount of 2% is offered by the supplier for payment within 10 days, and Martin Company takes all discounts. Shipping costs, which Martin Company must pay, amount to $130 for an average shipment of 100 15-gallon containers of Echol.
Use of Echol The bill of materials calls for 7.6 quarts of Echol per bottle of cleaning solvent. (Each gallon contains four quarts.) About 5% of all Echol used is lost through spillage or evaporation. In addition, statistical analysis has shown that every 41st bottle is rejected at final inspection because of contamination.
Required:
a. Compute the standard purchase price for one quart of Echol.
b. Compute the standard quantity of Echol (in quarts) per salable bottle of cleaning solvent.
c. Using the data from (1) and (2) above, prepare a standard cost card showing the standard cost of Echol per bottle of cleaning solvent.
Answer: a. $1.90
b. 8.2 quarts
c. $15.58
Explanation:
a. Compute the standard purchase price for one quart of Echol.
Cost per 15 gallon container = $115
Less: Cash discount= 2% × $115 = $2.30
Net cost = $115 - $2.30 = $112.70
Add: Shipping cost = $139/100 = $1.30
Total cost = $112.70 + $1.30 = $114
Number of quarts per container = (15 × 4) = 60
Standard cost per quart = $114/60 = $1.90
b. Compute the standard quantity of Echol (in quarts) per salable bottle of cleaning solvent.
Content per bill of materials = 7.6 quart
Add: Allowance for evaporation and spillage = 8.0 - 7.6 = 0.4 quart
Add: Allowance for rejected unit = 8.0/40 = 0.2 quarts
Standard quantity of Echol per salable bottle of cleaning solvent = 7.6 + 0.4 + 0.2 = 8.2 quarts
c. Using the data from (1) and (2) above, prepare a standard cost card showing the standard cost of Echol per bottle of cleaning solvent.
This will be:
= 8.2 quart × $1.90 per quart
= $15.58
On January 1, 2019, Sunland Company granted Sam Wine, an employee, an option to buy 1,000 shares of Sunland Co. stock for $30 per share, the option exercisable for 5 years from date of grant. Using a fair value option pricing model, total compensation expense is determined to be $5520. Wine exercised his option on October 1, 2021 and sold his 1,000 shares on December 1, 2021. Quoted market prices of Sunland Co. stock in 2021 were:
Using the fair value method, Sunland Company should recognize compensation expenses for 2019on its books in the amount of 2019 is $5,520.
What is a compensation expense?Compensation expenses are compensation-associated expenses used as a reward for exceptional job performance.
Examples of such compensation expense plans include bonuses, commissions, stock options, and profit-sharing.
Data and Calculations:Number of option shares granted = 1,000 shares
Grant price = $30
Exercise period = 5 years
Total compensation expense based on the fair value option pricing model = $5,520
The 2019 compensation expense = $6,000 ($30 x 1,000)/5
Question Completion:Quoted market prices of Sunland Co. stock in 2021 were:
July 1 = $30 per share
Oct 1 = $36 per share
Dec 1 = $40 per share
Required:
As a result of the option granted to Wine, using the fair value method, Sunland Company should recognize compensation expenses for 2019 on its books in the amount of 2019.
Thus, the 2019 compensation expense is $5,520.
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Prepare journal entries to record each of the following transactions. The company records purchases using the gross method and a perpetual inventory system.
Sept. 15 Purchased merchandise with an invoice price of $77,500 and credit terms of 3/5, n/15.
Sept. 29 Paid supplier the amount owed on the September 15 purchase.
Answer and Explanation:
The journal entries are shown below;
On Sept 15
Merchandise inventory $77,500
To Accounts payable $77,500
(Being purchase of inventory is recorded)
On Sep 29
Accounts payable $77,500
To Cash $75,175
To Merchandise inventory (3% of $77,500 ) $2,325
(Being payment to suppliers after discount is recorded)
A metal fabrication company is buying a CNC machine for $600,000. After 20 years of use, the machine should have a salvage value of $35,000.
Required:
a. Under 100% bonus depreciation, what depreciation can be claimed in year 1?
b. Under 100% bonus depreciation, what depreciation can be claimed in year 2?
Answer:
100% Bonus Depreciation:
a. Year 1 = $565,000
b. Year 2 = $0
Explanation:
a) Data and Calculations:
Cost of CNC Machine = $600,000
Salvage value = $35,000
Depreciable amount = $565,000 ($600,000 - $35,000)
100% Bonus Depreciation:
Year 1 = $565,000
Year 2 = $0
b) The 100% bonus depreciation is not limited to the firm's taxable income. The firm can carry back loss arising from 100% bonus depreciation to previous year's income and also carry any unused loss forward to deduct against future income.
