Answer:
a. 0.97 units per dollar input. b. $3.48 per dollar input.Explanation:
a. Units sold per dollar input:
= Total units / (Total wage + Total Raw Material cost + Total Component cost)
= 50,200 / ( (7.60 * 625 hours) + 31,500 + 15,645)
= 50,200 / 51,895
= 0.97 units sold per dollar input
b. Sales per dollar input:
= Total sales / (Total wage + Total Raw Material cost + Total Component cost)
= (50,200 * 3.60 per unit selling price) / 51,895
= 180,720 / 51,895
= $3.48 per dollar input
When making business changes in the short run, management sometimes gets locked in to certain costs arising from previous decisions. This is type of cost is best known as:_______.
a. controllable.
b. differential.
c. uncontrollable.
d. sunk.
Answer: This is the type of cost known as Sunk.
sunk cost is a cost that has already been incurred and cannot be recovered. Sunk costs are contrasted with prospective costs, which are future costs that may be avoided if action is taken.A sunk cost refers to money that has already been spent and which cannot be recovered. ... Sunk costs are excluded from future business decisions because the cost will remain the same regardless of the outcome of a decision.The sunk cost effect is manifested in a greater tendency to continue an endeavor once an investment in money, effort, or time has been made. Evidence that the psychological justification for this behavior is predicated on the desire not to appear wasteful is presented.Diamond Boot Factory normally sells its specialty boots for $22 a pair. An offer to buy 100 boots for $15 per pair was made by an organization hosting a national event in Norfolk. The variable cost per boot is $9, and special stitching will add another $1 per pair to the cost.
Determine the differential income or loss per pair of boots from selling to the organization.
Answer: $5.00
Explanation:
Differential income per pair is:
= Revenue per pair - Total cost per pair
= Selling price of pair - (Variable cost + Additional stitching cost)
= 15 - (9 + 1)
= 15 - 10
= $5.00
A company reporting under US GAAP seeking to present a more favorable view of operating income in its quarterly earnings release could: Identify a gain on sale in a non-GAAP reconciliation. Identify a restructuring charge (expense) in a non-GAAP reconciliation. Identify a loss in the fair value of an equity investment. Elect to not recognize stock-based compensation on its GAAP income statement. All of the abo
Answer: All of the above
Explanation:
Based on the information given, we can infer that the company reporting under US GAAP that seeks to present a more favorable view of operating income in its quarterly earnings release will do all of the above options given.
The company can identify the gain on the sale in a non-GAAP reconciliation, or a restructuring charge in a non-GAAP reconciliation. There can also be identification of a loss in the fair value of an equity investment and can also elect to not recognize stock-based compensation on the GAAP income statement.
There are some instances whereby the operations of a business aren't portrayed properly by GAAP reporting. Then, companies can then display their own accounting figures, which will disclosed as non-GAAP.
Joan Martin expects interest rates to decline over the next few months.To achieve her long-term financial goals,she will trade off liquidity for a higher return by using a:_________.
A) regular savings account.
B) interest-bearing checking account.
C) five-year certificate of deposit.
D) money market account.
E) money market fund.
Answer: C. Five year certificate of deposit.
Explanation:
A certificate of deposit refers to a savings account whereby a fixed amount of money is being held for a fixed period of time, and interest is earned on it.
Since Joan Martin expects interest rates to decline over the next few months, in order to achieve her long-term financial goals, then she will trade off liquidity for a higher return by using a five year certificate of deposit. Here, the liquidity is low when it's compared to that of the regular savings account.
A taxpayer's spouse dies in August of the current year. Which of the following is the taxpayer's filing status for the current year?
a. Single.
b. Qualified widow(er).
c. Married filing jointly.
d. Head of household.
Answer:
b. Married filling jointly
Explanation:
From the question we are informed about taxpayer's spouse who dies in August of the current year. In this case,
the taxpayer's filing status for the current year would be Married filling jointly. Joint return can be regarded as tax return which is been filed with the Internal Revenue Service by two married taxpayers that decide to have a filing status of "married filing jointly" or a widowed taxpayer that decide to have a filing status of " Qualifying Widow "A joint return give room for the
taxpayers to join their tax liability as well as report their income, credits and
deductions on the same joint return.
The joint return rates still validly
apply even two year after the death of a particular spouse, so far the
surviving spouse of the dead spouse does not remarry and still maintains a household as regards a dependent child.
Periwinkle Manufacturing Company has the following budgeted costs for 10,000 units: Variable Costs Fixed CostsManufacturing $200,000 $75,000 Selling & Administrative 100,000 25,000Total $300,000 $100,000What is the initial selling price needed to obtain a target profit of $200,000 using the variable cost markup method?A. $30.B. $55.C. $60.D. $50.
Answer:
C. $60
Explanation:
Calculation to determine the initial selling price needed to obtain a target profit of $200,000 using the variable cost markup method
Using this formula
Contribution margin = (Selling price x Units produced) - Variable costs
Profit = Contribution - Fixed costs
Profit = $200,000
Fixed costs = $100,000
Variable costs = $300,000
$200,000 = Contribution -$100,000
Contribution=$200,000+$100,000
Contribution = $300,000
$300,000 = (Selling price x 10,000 units)-$300,000
Selling price=$300,000+$300,000/10,000 units
Selling price =$600,000 /10,000 units
Selling price = $60
Therefore the initial selling price that is needed to obtain a target profit of $200,000 using the variable cost markup method is $60
All of the following are true of IT policy frameworks, except: A. an IT policy framework includes policies, standards, baselines, procedures, guidelines, and a taxonomy. B. the framework must define the business as usual (BAU) activities and accountabilities needed to ensure information security policies are maintained. C. an IT policy framework should be fully accessible by executives and managers, with relevant highlights shared with general employees. D. you can measure success by how well the framework helps reduce risk to the organization.
Answer:
D. you can measure success by how well the framework helps reduce risk to the organization.
Explanation:
The IT policy measures includes
1. The policies, standard, etc
2. It is the framework that works with the bau activities in order to ensure the policies related to the information security that should be maintained
3. It could be fully accessible by the executives having a relevant highlights that shared with the general employees
SO, the option d is considered
Ortega Company manufactures computer hard drives. The market for hard drives is very competitive. The current market price for a computer hard drive is $54. Ortega would like a profit of $14 per drive. What target cost Ortega should set to accomplish this objective
Answer:
$40
Explanation:
Target cost is the cost per unit arrived at after having deducted the required profit margin from the competitive market price.
It is a management technique that makes management think about ways to achieve a set target cost rather than forcing their actual cost plus profit margin on customers.
In this case, the competitive market price is $54 per unit of hard drive whereas the company expects to achieve a total profit of $14 per unit
Profit margin per unit=$14
competitive market price=$54
Target cost=competitive market price-profit margin per unit
Target cost=$54-$14
Target cost=$40
Use the following information to prepare the September cash budget for PTO Co. The following information relates to expected cash receipts and cash payments for the month ended September 30. Beginning cash balance, September 1, $43,000. Budgeted cash receipts from sales in September, $256,000. Raw materials are purchased on account. Purchase amounts are August (actual), $80,000, and September (budgeted), $109,000. Payments for direct materials are made as follows: 65% in the month of purchase and 35% in the month following purchase. Budgeted cash payments for direct labor in September, $33,000. Budgeted depreciation expense for September, $3,900. Other cash expenses budgeted for September, $55,000. Accrued income taxes payable in September, $10,100. Bank loan interest payable in September, $1,800.
Answer:
PTO Co.
Cash Budget for the month of September
Beginning cash balance, September 1, $43,000
Budgeted cash receipts from sales 256,000
Total cash available $299,000
Cash Disbursements:
Payment to suppliers $98,850
Payment to workers 33,000
Other expenses 55,000
Income tax 10,100
Bank loan interest 1,800 $198,750
Ending cash balance, Sept. 30 $100,250
Explanation:
a) Data and Calculations:
Beginning cash balance, September 1, $43,000
Budgeted cash receipts from sales in September, $256,000
Raw materials are purchased on account
Purchase amounts are August (actual), $80,000, and September (budgeted), $109,000
Payments for direct materials are made as follows:
65% in the month of purchase and
35% in the month following purchase.
Budgeted cash payments for direct labor in September, $33,000.
Budgeted depreciation expense for September, $3,900.
Other cash expenses budgeted for September, $55,000.
Accrued income taxes payable in September, $10,100.
Bank loan interest payable in September, $1,800
August September
Credit purchases $80,000 $109,000
Payments for purchases:
65% purchase month 70,850
35% ffg month 28,000
Total cash payment for purchases $98,850
Clay is a marketing student learning how to evaluate value propositions for effectiveness. He looked through ten different propositions and found them to all be ineffective. What elements did he mostly likely identify as the reasons for their ineffectiveness?
Answer: they were generic, and they had no unique value communicated
Explanation:
Value proposition refers to the promise
that's made by an organization to its customers indicating why a product should be bought.
Since Clay looked through ten different propositions and found them to all be ineffective, the reason attributed to this will be due to the fact that the propositions were generic, and had no unique value communicated.
Một doanh nghiệp sản suất hai loại hàng hóa là G1 và G2 , bán ra thị trường
với giá tương ứng là 70 USD và 50 USD. Tổng chi phí cho bởi
[tex]TC=Q1^{2} + Q1Q2 +Q2^{2}[/tex]
trong đó Q1 và Q2 lần lượt tương ứng là số lượng hàng hóa G1 và G2 . Tìm số lượng hàng hóa Q1 và Q2 để tối ưu lợi nhuận.
Answer:
Một doanh nghiệp sản suất hai loại hàng hóa là G1 và G2 , bán ra thị trường
với giá tương ứng là 70 USD và 50 USD. Tổng chi phí cho bởi
trong đó Q1 và Q2 lần lượt tương ứng là số lượng hàng hóa G1 và G2 . Tìm số lượng hàng hóa Q1 và Q2 để tối ưu lợi nhuận.
Explanation:
A Mike’s Milk estimates gallon milk sales for the first quarter as 12,000 gallons in January, 15,000 in February and 10,000 in March. Mike sells milk for $3.00 per gallon. Complete the following schedule for the first quarter sales budget.
Forecasted gallons January February March
Price Per gallon
Sales Budget
Answer:
Results are below.
Explanation:
Giving the following information:
A Mike’s Milk estimates gallon milk sales for the first quarter as 12,000 gallons in January, 15,000 in February, and 10,000 in March.
January:
Forecasted gallons= 12,000
Price per gallon= 3
Sales Budget= $36,000
February:
Forecasted gallons= 15,000
Price per gallon= 3
Sales Budget= $45,000
March:
Forecasted gallons= 10,000
Price per gallon= 3
Sales Budget= $30,000
Summer 20 Corp estimates overhead based on direct labor hours and has given you the following information:
Estimated Manufacturing Overhead Costs 2020 $405,000
Estimated Direct Labor Hours for 2020 220,000
Actual Direct Labor Hours for 2020 202,000
Manufacturing Overhead Account Debit Entries total $380,000
1. Determine the predetermined overhead allocation rate stated with cents.
2. Determine the amount of manufacturing overhead that was allocated.
3. Calculate the amount Summer 20 Corp is over or under allocated during the year.
Answer:
Results are below.
Explanation:
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 405,000 / 220,000
Predetermined manufacturing overhead rate= $1.841 per DLH
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 1.841*202,000
Allocated MOH= $371,882
Finally, the over/under allocation:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 380,000 - 371,882
Underapplied overhead= $8,118
What are the three vital functions that money performs? Which of the following items perform some but not all of these functions, and which perform all of these functions? Which of the items are money? a. A credit card b. A checking account at the Bank of America c. A $ 10 bill d. Upper A diamond ring e. Plastic sheets used to make Visa cards f. Ancient Roman coins g. GM bonds
Answer:
The answer is below
Explanation:
The three vital functions that money performs are the following
1. i) medium of exchange,
ii) unit of account
iii) store of value
2. Items "B (A checking account at the Bank of America)" perform all of these functions and are money.
Items "A. (A credit card)
B. (A checking account at the Bank of America)
D. (A Upper A diamond ring)
E. (Plastic sheets used to make Visa cards, )
F. (Ancient Roman coins)
G. (GM bonds) perform some of these functions and are not money.
What are the opportunity offers by
vocational education?
Answer:
Where I grew up, I went to a vocational school for just the beginning of the year, then left to a charter school, At a vocational school, I can choose a cooking class, welding, mechanic, and some other neat stuff, it's kinda of preparing you to be independent, but also you can do it working with other people too.
They are strict with absences and tardies, 3 tardies make one absence, and absences put penalties on your highschool resume/record, depending on how many penalties from absences and tardies you get, they kick you out of the school which is not fair if you have construction workers on the road slowing you down on your way to school for 3 months.
If you do a vocational school, collages you want to go to are more likely to take you in faster than a person who went to a regular high school.
20 points to the best one !!
Answer:
The answer is "Knowledge discovery & predictions category or anomalous detention assessment or Data mining".
Explanation:
Regression is a type of analysis in which some parameters' relationships are determined by the values of other variables, whereas departure detection is a type of analysis wherein the goal is to find changes in data from previously observed values. Enigma detaining analysis, often known as knowledge discovery analysis, is a sort for anomaly incarceration analysis, while regression is classed as a forecast.
Andrews has a new design for their product Axe next round that can reduce their material cost of producing units from $8.13 to $7.33. Andrew passes on one quarter of all cost savings by cutting the current price to customers. For simplicity: Current selling price = $19.00; Use current labor costs of $4.02; Use period costs of $7,260 (from Income Statement).
Required:
Determine the new selling price to break even next round.
Answer:
$18.80
Explanation:
New selling price = Old selling price - Adjustments
Old selling price = $19.00, Adjustments = 1 quarter of reduced raw material costs difference
New selling price = $19.00 - ($8.13 - $7.33)/4
New selling price = $19.00 - $0.20
New selling price = $18.80
So, the new selling price to break even next round is $18.80.
On May 28, 2021, Pesky Corporation acquired all of the outstanding common stock of Harman, Inc., for $590 million. The fair value of Harman's identifiable tangible and intangible assets totaled $631 million, and the fair value of liabilities assumed by Pesky was $169 million. Pesky performed a goodwill impairment test at the end of its fiscal year ended December 31, 2021. Management has provided the following information:
Fair value of Harman, Inc. $570 million
Fair value of Harman's net assets (excluding goodwill) 510 million
Book value of Harman's net assets (including goodwill) 594 million
Required:
a. Determine the amount of goodwill that resulted from the Harman acquisition.
b. Determine the amount of goodwill impairment loss that Pesky should recognize at the end of 2021, if any.
c. If an impairment loss is required, prepare the journal entry to record the loss.
Answer:
Explanation:
Calculation of Goodwill -
$ in Million $ in Million
Consideration given $ 590
Less: F.V of Harman's net assets
Assets
631
Less: F.V of Liabilities
(169) (462)
Goodwill on acquisition $ 128
2. The impairment loss Pesky would recognize at the end of year 2021 is $ 68 million , since the book value of the net assets exceeds its fair value.
Calculation :-
$ in million $ in million
Goodwill 128
Less Implied value of goodwill
F.V of Harman's, Inc
570
F.V of Harman's net assets (excluding Goodwill)
(510) (60)
Impairment Loss $ 68
3. Journal entry to record loss:
Dr Cr
Loss on impairment of goodwill Dr $ 68 million
Goodwill
$ 68 million
(To record the impairment loss
Given D: Annual use of a particular item, in number of items per year Q: Number of items ordered in one purchase order, in units SS: Safety stock, in units L: Lead time, in fraction of a year I: Current inventory on hand, units Reorder point can be expressed as ______ (x below denotes the multiplication sign).
Answer:
D×L + SS
Explanation:
The reorder point (ROP) is the inventories or stock level for a certain product that, when attained, initiates the reordering of more inventories. The lead time it will take to refill inventories is taken in when computing the reorder points for different stock holding units. This ensures inventory levels do not approach zero.
Computing reorder points necessitates a thorough understanding of purchase habits over a specific time period. The more ROP you compute for each product, the better you'll be able to anticipate future demand and guarantee you're using the reorder quantity calculation appropriately.
From the given information in the question:
The reorder point can be determined by using the formula:
Reorder point = Demand (D) at the point of leas time (L) with the addition of safety stock (SS)
Reorder point = D×L + SS
Benny is the manager of an office-support business that supplies copying, binding, and other services for local companies. He must replace a worn-out copy machine that is used for black-and-white copying. He is considering two machines, and each of these has a monthly lease cost plus a cost for each page that is copied. Machine 1 has a monthly lease cost of $619, and there is a cost of $0.030 per page copied. Machine 2 has a monthly lease cost of $675, and there is a cost of $0.028 per page copied. Customers are charged $.16 per page copied. If Benny expects to make 105,000 copies per month, what would be the monthly cost for each machine
Answer:
Machine one cost:
= Fixed cost + Variable cost
The Fixed cost is the lease cost and the variable cost is the cost per page copied. The number of pages is 105,000 and the cost per page for machine 1 is $0.030
= 619 + (0.030 * 105,000)
= $3,769 monthly
Machine two cost:
= 675 + (0.028 * 105,000)
= $3,615 monthly
On January 1, Great Designs Company had a debit balance of $2,183 in the office supplies account. During the month, Great Designs purchased $515 and $500 of office supplies and journalized them to the asset account upon purchasing. On January 31, an inspection of the office supplies cabinet shows that only $774 of office supplies remains. Journalize the January 31 adjusting entry for office supplies. If an amount box does not require an entry, leave it blank. Jan 31 ________ _______ ________ ________
Answer: Dr Office supplies expense $2,424
Cr Office supplies $2,424
Explanation:
Based on the information given in the question, the January 31 adjusting entry for office supplies goes thus:
Journal entry on Jan 31st-
Dr Office supplies expense $2,424
Cr Office supplies $2,424
Working:
Total office supplies available = $2183 + $515 + $500 = $3198
Total supplies available on January, 31st = $774
Therefore, supplies consumed will be:
= $3198 - $774
= $2424
Which answer does not describe the benefits to the industry-wide practice of localization?
a) It is only used in the game industry
b) It creates wide audience appeal
c) It is time-saving
d) It is cost-effective
Answer:
a) It is only used in the game industry
Explanation:
The statement that does not describe the benefits to the industry-wide practice of localization is that "It is only used in the game industry."
This because Localization in business or industry practice is a means or process of modifying a product or service to fulfill the needs of a specific area or locality in terms of language, culture, or targeted population's perceptions.
Hence, it doesn't apply to the GAME INDUSTRY alone but rather to every industry.
Also, there are lots of advantages of Localization of products, which includes wide acceptance across the targeted audience, time-saving, as it focuses on a particular region, and cost-effective as the target population can be easily satisfied compared to satisfy global market all in one product make up style.
example of business proposal
Trust incurred $10,000 of portfolio income. Its corporate trustee paid fiduciary fees of $1,000 therefrom, and also paid $1,000 in premiums for a life insurance policy on Marcia, the grantor of the trust. How much gross income does Marcia include with respect to these trust activities?
A) $800.
B) $1,000.
C) $8,000.
D) $9,000.
E) $10,000.
Answer:
$1,000
Explanation:
Based on the information given the
GROSS INCOME amount that Marcia will include with respect to these trust activities will be the amount of $1,000 because we were told that the amount of $1,000 was paid in premiums for a LIFE INSURANCE POLICY ON MARCIA who is the GRANTOR OF THE TRUST, although The trust is not categorized as a grantor trust reason been that the TRUSTEE was authourized to pay the life insurance premiums
Alpha Inc. and Beta Co. are sheet metal processors that supply component parts for consumer product manufacturers. Alpha has been in business since 1985 and is operating in its original plant facilities. Much of its equipment was acquired in the 80s and 90s. Beta Co. was started two years ago and acquired its building and equipment then. Each firm has about the same sales revenue, and material and labor costs are about the same for each firm.
What would you expect Alpha’s ROI to be relative to the ROI of Beta Co.? Explain your answer.
What are the implications of this ROI difference for a firm seeking to enter an established industry?
Answer: A. Higher
B. The implication for Beta Co. is that because of its lower ROI, its ability to raise capital will be reduced.
Explanation:
a. What would you expect Alpha’s ROI to be relative to the ROI of Beta Co.? Explain your answer.
In this case, Alpha’s ROI to be relative to the ROI of Beta Co. will be higher. Since Alpha's investment cost is lower when compared to that of ‘Beta Co. while both companies have thesame operating income, then the return on investment of Alpha will then be higher than that of Beta due to the lower investment cost that Alpha incurred.
b. What are the implications of this ROI difference for a firm seeking to enter an established industry?
The implication for Beta Co. is that because of its lower ROI, its ability to raise capital will be reduced.
What are similarity and difference between delayed payment and trade credit?
Help me pls, I have a time limited
Answer:
Delayed Payment means a purchase by a buyer in which title to the grain passes to the buyer at a determined price and payment to the seller is not made in less than twenty-one (21) days after delivery.
Answer:
Trade credit is a business-to-business (B2B) agreement in which a customer can purchase goods without paying cash up front, and paying the supplier at a later scheduled date. Usually, businesses that operate with trade credits will give buyers 30, 60, or 90 days to pay, with the transaction recorded through an invoice.
Trade credit can be thought of as a type of 0% financing, increasing a company’s assets while deferring payment for a specified value of goods or services to some time in the future and requiring no interest to be paid in relation to the repayment period.
KEY TAKEAWAYS
Trade credit is a type of commercial financing in which a customer is allowed to purchase goods or services and pay the supplier at a later scheduled date.
Trade credit can be a good way for businesses to free up cash flow and finance short-term growth.
Trade credit can create complexity for financial accounting depending on the accounting method used.
Trade credit financing is usually encouraged globally by regulators and can create opportunities for new financial technology solutions.
Suppliers are usually at a disadvantage with a trade credit as they have sold goods but not received payment.
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1:31
Trade Credit
Understanding Trade Credit
Trade credit is an advantage for a buyer. In some cases, certain buyers may be able to negotiate longer trade credit repayment terms, which provides an even greater advantage. Often, sellers will have specific criteria for qualifying for trade credit.
A B2B trade credit can help a business to obtain, manufacture, and sell goods before ever having to pay for them. This allows businesses to receive a revenue stream that can retroactively cover costs of goods sold. Walmart is one of the biggest utilizers of trade credit, seeking to pay retroactively for inventory sold in their stores. International business deals also involve trade credit terms. In general, if trade credit is offered to a buyer it typically always provides an advantage for a company’s cash flow.
The number of days for which a credit is given is determined by the company allowing the credit and is agreed upon by both the company allowing the credit and the company receiving it. Trade credit can also be an essential way for businesses to finance short-term growth. Because trade credit is a form of credit with no interest, it can often be used to encourage sales.
Since trade credit puts suppliers at somewhat of a disadvantage, many suppliers use discounts when trade credits are involved to encourage early payments. A supplier may give a discount if a customer pays within a certain number of days before the due date. For example, a 2% discount if payment is received within 10 days of issuing a 30-day credit. This discount would be referred to as 2%/10 net 30 or simply just 2/10 net 30.
Trade Credit Accounting
Trade credits are accounted for by both sellers and buyers. Accounting with trade credits can differ based on whether a company uses cash accounting or accrual accounting. Accrual accounting is required for all public companies. With accrual accounting, a company must recognize revenues and expenses at the time they are transacted.
Trade credit invoicing can make accrual accounting more complex. If a public company offers trade credits it must book the revenue and expenses associated with the sale at the time of the transaction. When trade credit invoicing is involved, companies do not immediately receive cash assets to cover expenses. Therefore, companies must account for the assets as accounts receivable on their balance sheet.
With trade credit, there is the possibility of default. Companies offering trade credits also usually offer discounts, which means they can receive less than the accounts receivable balance. Both defaults and discounts can require the need for accounts receivable write-offs from defaults or write-downs from discounts. These are considered liabilities a company must expense.
Alternatively, trade credit is a useful option for businesses on the buying side. A company can obtain assets but would not need to credit cash or recognize any expenses immediately. In this way, trade credit can act like a 0% loan on the balance sheet.
financial lit Banks offer other types of services such as safe deposit boxes for customers to store valuable documents. List at least two other types of non-account services that the provider makes available to customers, either for a fee or at no cost.
Answer and Explanation:
Banks offer agency services too such as being trustees, executors, or financial advisors to their customers. They can also stand as guarantee for their customers.
Banks also offer reference services. They provide information on the financial position or strength of their customers for the purpose of a customer's business dealing. This is usually done confidentially and with the permission of the customer
Shaq Corporation issued $10,000 of 20-year bonds on January 1, 2021. The bonds pay interest semiannually. This is a partial bond amortization schedule for the bonds.
Payment Cash Effective interest Decrease in balance Outstanding balance
9,080
1 400 409 9 9,089
2 400 409 9 9,098
3 400 409 9 9,107
4 400 410 10 9,117
What is the effective annual rate of interest on the bonds?
a. 9.0%.
b. 4.5%.
c. 8.0%.
d. 4.0%.
Answer:
The correct option a. 9.0%.
Explanation:
Note: The data in this question are merged together. They are therefore sorted before answering the question. See the attached pdf file for the complete question with the sorted data.
The explanation of the answer is now given as follows:
Effective semiannual interest rate = Effective interest / Previous outstanding balance ……………………. (1)
Using Payment 1 information, we have:
Effective semiannual interest rate = 409 / 9,080 = 0.0450, or 4.50%
Effective annual interest rate = Effective semiannual interest rate * Number of semiannuals in a year = 4.50% * 2 = 9.0%
Therefore, the correct option a. 9.0%.
You have decided to invest in two bonds. Bond X is an n-year bonod with semiannual coupons, while bond Y is zero-coupon bond, which is re- deemable in 2 years. The desired yield rate is the same for both bonds. You also have the following information:
Bond X:
Par value is 1000.
The ratio of the semi-annual bond rate to the desired semi-annual yield rate, that is is r/i 1.03125.
b. The present value of the redemption amount is 381.50.
Bond Y:
Redemption value is the same as that of bond X.
Price to yield is 647.80.
What is the price of bond X?
Answer:
The price of the bond X is 1055.09.
Explanation:
The price of Bond X can be determined as follows:
Let:
R = Present value of the Redemption amount of X and Y
i = yield of both Bond X and Bond Y
For Bond X, we have:
381.5 = R / (1+i)n ………………… (1)
For Bond Y, we have:
647.80. = R/(1+i)(n/2) ……………….. (2)
Use equation (2) to divide equation (1), we have:
381.5/647.8 = 1/ (1+i)(n/2) ……………………….. (3)
0.588916332201297= 1/ (1+i)(n/2)
(1+i)(n/2) = 1 / 0.588916332201297
(1+i)(n/2) = 1.69803407601573
647.80 = R / 1.69803407601573
R = 647.80 * 1.69803407601573 = 1,099.99, or 1,100
Now, also let:
r = coupon rate of Bond X
P= present value of Cash flows of Bond X
Therefore, we have:
P = 1000 * (r/2) / (1+i)0.5 + 1000*(r/2)/ (1+i)1+....+1000 * (r/2) /(1+i)n+ 1100/(1+i)n
It can be observed that we have 2n terms indicating present value of 2n semiannual coupon payments and last term is present value of Redemption amount.
Applying GP formula, we have:
P = 1000 *(r/2) * (1- (1+i)-n) / ((1+i)(1/2) -1) + 1100 * (1+i)-n
Looking at equation (3), we it can be observed that we can have:
(1+i)-(n/2) = 381.5/647.8 = 0.588916
Therefore, we have:
(1+i)-n = 0.5889162= 0.346822
By employing the Binomial approximation, we have:
(1+i)(1/2)= 1+i/2+... very small terms = 1 + i/2
This indicates that:
(1+i)(1/2)-1 = i/2
If we substitute this into the price equation, we will have
P = 1000 *(r/2) * (1-0.346822) / ( i/2) + 1100 * 0.346822 = 1000 * (r/i) * 0.653178 + 381.504
Since r/i = 1.03125, we have:
P = 653.178 * 1.03125 + 381.504 = 1055.09
Therefore, the price of the bond X is 1055.09.
Sau khi thực hiện kiểm toán, KTV xác định là:
1- BCTC theo mục đích chung của công ty được trình bày hợp lý
2- Bộ phận thu quỹ của công ty không hữu hiệu
3- Thuế TNDN của cty tính toán không phù hợp với luật thuế
4- Quốc hội muốn kiểm tra chi tiêu của Bộ Quốc phòng và Bộ Ngoại giao
5- BCTC của một trung tâm y khoa tư nhân được lập phù hợp với các chuẩn mực
kế toán.
6- Quản đốc phân xưởng không thực hiện đúng trách nhiệm của mình như đã phân
công.
7- Chi cục thuế đã vi phạm việc thuê mướn nhân viên do nhà nước qui định
8- BCTC của một DN nhà nước cần kiểm toán để cổ phần hóa
9- BCTC của một UBND tỉnh trình bày đúng với thực tế thu và chi tiền
10- Dịch vụ thực hiện qua bưu điện cho một huyện ngoại thành là không hiệu quả
11- Công ty đã thực hiện đúng các điều khoản hợp đồng vay ngân hàng
12- Một bộ phận không thực hiện đúng các chính sách về làm thêm giờ do công ty
đề ra.
Yêu cầu:
a. Hãy chỉ ra loại kiểm toán nào đã tiến hành trong các loại kiểm toán sau: (1)
BCTC; (2) Tuân thủ; (3) Hoạt động
b. Xác định loại KTV thực hiện: (1) độc lập; (2) nội bộ; (3) nhà nước.
c. Xác định đối tượng chính để nhận báo cáo kiểm toán: (1) đối tác; (2) nhà quản lý;
(3) nhà nước... Sử dụng bảng dưới đây để trả lời cho các loại câu hỏi trên: Loại kiểm
toán, Loại KTV, Đối tượng nhận chính.
