On January 1, 2020, Craig and Hillary start a partnership. Craig invests a building worth $70,000 and equipment valued at $18.000. Hillary invests $20,000 in cash. The partners have agreed that Hillary will operate the business and be an equal partner in the beginning capital balances. The journal entry on January 1 to record the transaction using the goodwill method would be:
Type "Debit" in front of each debit line.
Type "Credit" in front of each credit line.
Show and label calculations.

Answers

Answer 1

On January 1, 2020, Craig and Hillary start a partnership. : Debit ,Building: 70,000 Equipment: 18,000 ,Cash: 20,000 ,Total: 108,000 Credit

Partners' Capital: 54,000

Hillary's Capital: 54,000

Journal entries are used to document business transactions in an organization's accounting records. A journal entry is often made in the general ledger, but it can also be made in a subsidiary ledger and subsequently rolled forward into the general ledger after being summarized. After then, the general ledger is utilized to produce the company's financial statements.

Every business transaction should be recorded in at least two places, according to the reasoning behind a journal entry (known as double entry accounting). For instance, when you make a cash sale, the revenue account and the cash account are both increased.

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Related Questions

the unlimited gift tax exclusion for medical or education expenses can only be gifted to which of the following

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The unlimited gift tax exclusion for medical or education expenses can only be gifted to individuals, not to organizations or entities.

How do you qualify this exclusion?

To qualify for this exclusion, the gift must be made directly to the medical or educational institution, and the funds must be used to pay for the recipient's qualifying expenses. Qualifying medical expenses include amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease, and amounts paid for transportation to receive medical care.

The unlimited gift tax exclusion for medical or education expenses is separate from the annual gift tax exclusion, which allows an individual to make gifts up to a certain amount each year without incurring gift tax liability. The annual exclusion for 2021 is $15,000 per recipient.

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The market value of a fund's net assets divided by the number of mutual fund shares outstanding is called the NAV of the fund.
a. True
b. False

Answers

The market value of a fund's net assets divided by the number of mutual fund shares outstanding is called the NAV of the fund is option a. True.

What is market value in mutual fund?

It is the price at which investors purchase fund shares from a fund company (bid price) and sell them to a fund company (redemption price). The total worth of all the cash and securities in a fund's portfolio, less any liabilities, is divided by the number of outstanding shares to arrive at the fund's NAV.

The total value of the assets owned less the total liabilities equals the Net Asset Value (NAV), which calculates the market value of an investment vehicle, such as a mutual fund.

Therefore, the net asset value of an investment fund is calculated by dividing the number of outstanding shares by the net value of the fund's assets less its liabilities. The pricing of each share is based on the NAV, and funds may be open or closed.

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if personal taxes were decreased and resource productivity in short run increased simultaneously, the equilibrium . pick your answer from below and explain your answer choice using aggregate demand and aggregate supply

Answers

If private taxes had been reduced and aid productiveness multiplied simultaneously, the equilibrium output stage will always rise due to the fact tax is the quantity which authorities collects from their residents for the financial sports and make assets extra productive.

The required details for Equilibrium in given paragraph

Equilibrium is the kingdom wherein marketplace deliver and call for stability every other, and as a end result costs grow to be stable. Generally, an over-deliver of products or offerings reasons costs to go down, which ends up in better call for—even as an under-deliver or scarcity reasons costs to head up ensuing in much less call for. The balancing impact of deliver and call for effects in a kingdom of equilibrium. The equilibrium price is wherein the deliver of products fits call for.

When a major index reports a duration of consolidation or sideways momentum, it could be stated that the forces of deliver and call for are quite identical and the marketplace is in a kingdom of equilibrium.

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The disadvantages of the partnership form of business organization, compared to corporations, include.

Answers

One drawback of a partnership is that each participant has unlimited accountability for the obligations of the company. The debts of the partnership are "jointly and severally" owed by each member.

Partnership: What Is It?

A limited company is a type of business where two or more persons enter into a legal agreement to be co-owners, share in the organization's profits or losses, and divide the duties for managing it.

What kind of cooperation would that be?

By definition, a partnership business consists basically two or more individuals who pool their resources to create a company and agree to split the risks, rewards, and losses. Law firms, medical groups, private equity firms, and accountancy groups are typical instances of partnership businesses.

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FILL IN THE BLANK. The manager of a chain of dry cleaning stores gathers the competitions' advertisements for analysis and review. She needs these data to help the chain devise its own advertising strategy. The manager is acting in the _____ role.

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The manager of a chain of dry cleaners collects ads from rival businesses for evaluation and research. She wants this information to assist the chain in creating its own marketing plan. The manager is serving in an advisory capacity.

Experts in information technology include information managers (IT). They assist firms in coordinating and managing the flow of data by utilizing a special combination of project management, IT knowledge, and interpersonal communication abilities.

There are three roles for information. These include serving as a spokesman, a disseminator, and a monitor. There are four decision-making positions in all. These include being a businessperson, a problem solver, a resource manager, and a negotiator.

The three informational responsibilities that managers must perform are monitor, disseminator, and spokesperson are information collection, dissemination, and transmission.

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With regards to the technology adoption diffusion curve, in a tornado situation, O a. the entrepreneur's most important job is to give the customer a compelling reason to buy. O b. innovators and early adopters are the only ones with an interest in the technology. O c.customer demand fluctuates wildly. O d. the technology abruptly stops selling. O e. there is more demand than a company can possibly manage.

Answers

Laggards (16%): People in this group were the last to adopt a new technology.

What is a diffusion curve of adoption?

A diffusion curve of adoption is a graphical representation of the process by which a product or service is adopted by consumers over a given period of time. It shows the cumulative number of adopters of the product or service at any given point in time. The curve can also be used to compare the rate of adoption among different products or services. The curve typically follows a sigmoidal pattern, with a slow initial rate of adoption, followed by a rapid increase in the number of adopters, and then a gradual decrease in the number of adopters until the product reaches its maximum level of adoption.

Individuals in this category, in contrast to some of the categories that came before it, exhibit little to no opinion leadership.

These people typically have a tendency to be older and dislike change-agents.

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match the type of expense to the appropriate tier for the purpose of the home office deduction. tier 1 tier 1 drop zone empty. tier 2 tier 2 drop zone empty. tier 3 tier 3 drop zone empty. generally, expenses allocated to the business use of the home except for interest, taxes, and depreciation generally, mortgage interest and real property tax allocated to the

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The following instances of needs must be matched to each level of Maslow's Hierarchy:

What can we learn from Maslow's hierarchy?

Our knowledge of motivation, achieving goals, and finding personal fulfilment is strengthened as a result. Additionally, it gives human psychology a structure and clarity that previously appeared elusive. The hierarchy's simplicity has contributed to Maslow's theory's continued popularity over time.

Which of the Maslow hierarchy of requirements are some examples?

A few examples include air, food, water, shelter, clothing, heat, sex, and sleep. Among the requirements for safety are weatherproofing, security, peace, and stability. Love and togetherness, including the need for strong relationships as well as a sense of belonging are the primary social wants.

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there are three types of sources of short-term financing mary and john are considering: forego discounts and pay invoices on the due date, attempt to negotiate a monthly pay

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Trade credit, bank commercial loans, commercial paper, a particular kind of promissory note, and secured loans are the primary sources of short-term finance.

Why is financing for the short term crucial?

Most short-term loans are returned in a year or less. Less time in payments indicates a lower total amount of interest over the loan's life. Increasing the situation by making these payments on schedule and paying off the debt

What qualities define short-term financing?

Short-term loans are so named because they must be repaid in a short period of time. The typical time frame for repayment is six months to a year, with a maximum of 18 months. A medium-term loan is one with a term that is greater than that.

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A manufacturer with a product in the decline stage of the product life cycle might decide to________ if it has reason to hope that competitors will leave the industry.A) harvest the productB) maintain the product without changeC) drop the productD) search for replacementsE) delay planning

Answers

A manufacturer with a product in the decline stage of the product life cycle might decide to delay planning if it has reason to hope that competitors will leave the industry. The correct option is E.

What happens to the price of a product in the decline stage?

Pricing strategy at this stage: As a product loses market share, many companies decide to reduce its price. In fact, you can test a few different pricing methods at this point. To draw in more customers, you might try a pricing strategy that offers discounts. This will make room at your company for new products.

When a product disintegrates as a result of slowing down or experiencing negative growth, it enters the decline stage of its life cycle. Lower demand, which ultimately results from fresh inventions and technological advancements, is the cause.

Thus, the ideal selection is option E.

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Properly designed and targeted telemarketing provides many benefits, including purchasing convenience and increased product and service information.

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Numerous advantages can be obtained by well-planned and targeted telemarketing, including easier shopping and more information about goods and services.

Is the assertion accurate?

True, well-planned and focused telemarketing offers a variety of advantages.

How does telemarketing operate and what is it?

Telemarketing is a direct form of advertising in which a sales professional makes phone calls to potential clients to promote a product or service. Customers may be contacted by salespeople via phone, email, or other means on the internet. Selling goods or services over the phone is known as telemarketing. Businesses will occasionally refer to it as "tele-sales" or "inside sales."

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the first task in search engine optimization is to format a website so the search engine can accurately assess the topics a website addresses readily calculate when a website was last updated quickly determine user activity on a website successfully identify a website's most popular content

Answers

The first step in search engine optimization is to format our website such that search engine can correctly judge the themes to which our website is relevant.

How would you describe optimization?

Maximizing or minimizing a function in relation to a set, which frequently represents the range of options that are accessible in a given scenario, is an optimization problem. The function enables comparison of the available options in order to identify the potential "best" option.

Which two optimization methods are there?

There are two sorts of optimization techniques that can be distinguished: heuristic optimization techniques and exact techniques, the latter of which does not provide any assurance how an optimal solution will be found.

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for a company's competitive strategy to succeed in delivering good performance or the intended competitive advantage over rivals

Answers

It needs to be supported by a collection of assets, expertise, and competitive qualities that are well matched to the strategy.

The term "competitive advantage" refers to a company's ability to manufacture goods or provide services more effectively than its rivals. It enables a business to produce value for the business and its shareholders while achieving greater margins.

A competitive advantage is something unique to a firm or industry that cannot be easily imitated. Internally generated value is what differentiates the company from its rivals.

Competitive advantages can take many different forms. They consist of, but are not restricted to, the following:

1) availability of natural resources not obtainable from rivals

2)Strong brand recognition and highly

3) competent workforce Access to proprietary or new technology

4) Price management

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using the following year-end information for workfit calculate the acid-test ratio: cash $ 51,900 short-term investments 12,000 accounts receivable (all current) 54,000 inventory 325,000 supplies 17,500 accounts payable 106,500 wages payable 24,500

Answers

The acid-test ratio is 1.03. The acid-test ratio contrasts a company's current obligations with its "quick asset. It is one of the six fundamental computations used to assess short-term liquidity, or an organization's capacity to pay its obligations when they become due.

What is the calculation?

The computation of the acid-test ratio is given below:

= Quick assets ÷ current liabilities

= (cash + short term investment + account receivable + supplies) ÷ (accounts payable + wages payable)

=($ 51,900 + $ 12,000 + $ 54,000 + $ 17,500) / ( $ 106,500 + $ 24,500)

=$135,400/ $ 131,000

=1.03

Therefore, the acid-test ratio is 1.03.

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Luker Corporation uses a process costing system. The company had $169,500 of beginning Finished Goods Inventory on October 1. It transferred in $846,000 of units completed during the period. The ending Finished Goods Inventory balance on October 31 was $167,200. The entry to account for the cost of goods sold in October is:
Multiple Choice
Debit Cost of Goods Sold $846,000; credit Finished Goods Inventory $846,000.
Debit Cost of Goods Sold $848,300; credit Finished Goods Inventory $848,300.
Debit Cost of Goods Sold $848,300; credit Work in Process Inventory $848,300.
Debit Finished Goods Inventory $167,200; credit Cost of Goods Sold $167,200.
Debit Finished Goods Inventory $846,000; credit Work in Process Inventory $846,000.

Answers

Debit $848,300 for the cost of goods sold; credit The item to reflect the cost of goods sold in October is Finished Goods Inventory $848,300.

Cost of Goods Sold Debit 848,300

(169,500+846,000-167,200) = 848,300 Credit - Finished Goods Inventory

The direct expenses incurred in creating the products a business sells are referred to as COGS. The cost of the materials and labor used directly to make the good are included in this sum. Indirect costs like those associated with the sales force and distribution are not included.

Due to the fact that COGS is deducted from revenues to calculate gross profit, it is a crucial financial statement indicator. The gross profit is a profitability indicator that assesses a company's capacity to effectively manage its work force and resources during the production process.

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over 3000 teens per year, between 15 and 20 years of age lose their lives in fatal crashes. texas drivers impact answers T/F

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True. According to the National Highway Traffic Safety Administration (NHTSA), 3,102 teens between 15 and 20 years of age lost their lives in fatal crashes in 2017.

This accounts for just over a quarter of all traffic fatalities in the United States, making teen drivers one of the most at-risk groups for fatal crashes. The leading cause of teen driver fatalities is distraction, followed by alcohol and drug use, speeding, and not wearing a seat belt.

Given these facts, it is important for teens to understand the risks associated with driving and take steps to practice safe driving habits. This includes avoiding distractions, never driving under the influence of alcohol or drugs, obeying speed limits, and always wearing seat belts.

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Consider the case when Sony uses a Periodic Review Policy (I, S). Sony plans to order from its supplier once in fourteen business days, corresponding to a Review Period of I = 14 business days. The supplier delivers each order in a lead-time of 6 business days. Sony has an expected (average) daily demand of 150 units with a standard deviation (of daily demand) of 30 units. The management team at Sony continues to target a 93% service level. What is the appropriate safety stock (SS) ? Given the appropriate safety stock (SS) and the same information as in question 4, what is the appropriate base stock (S)? (Considering your answers to questions 4 and 5) What happens to SS and S (increase or decrease) if the service level is increased from 93% to 95%? Given all information from question 4,5, and 6, if Sony has 220 cards leftover in inventory at the end of a review period, how much should it order from its supplier to have a 93% service level? Given all information from question 4,5,6. If Sony has 220 cards leftover in inventory at the end of a review period, how much should it order from its supplier to have a 95% service level?

Answers

A The standard deviation (or ) measures how widely distributed the data are in relation to the mean. Records are concentrated throughout the suggest if the general deviation is low, and high if the trend deviation is

Give a definition of a periodic review system and an illustration:

The periodic review technique allows you to estimate the quantity of a product your business has on hand at predetermined, set intervals of time (such as every Friday or the last day of every month).

What benefit does a system of periodic reviews offer?

The periodic inventory method has the benefit of eliminating the requirement for separate accounting for inventories of raw materials, work-in-progress, and finished items. The only thing that is noted are purchases.

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Largo Inc. is one of the market leaders in the food industry. It ensures that everything it does in the production process is geared toward keeping production costs low. A price cut is then passed on to its customers. Despite its cost control drive, Largo Inc. still makes products that are on par with industry standards. The organization strategy that Largo Inc. has adopted is referred to as a _____ strategy.
a) cost leadership
b) differentiation
c) minimizer
d) transformer

Answers

Cost leadership( Cost leadership is a term used when a company competes as the cheapest manufacturer or supplier of a particular product or commodity.)

What is example of cost leadership?

Companies that pursue a cost leadership strategy offer products or services of acceptable quality and functionality at low prices to a wide range of customers. For example, Super Shoes sells name brand shoes at bargain prices. Small Debbie Snack Cakes are another example.

What's the aim of cost leadership?

A cost leadership strategy aims to leverage production scale, well-defined scope, and other savings (such as better purchasing approaches) to produce highly standardized products using advanced technology. is. In recent years, more and more companies are choosing strategic combinations to achieve market leadership.

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involves coordinating and allocating a firm's resources so that the firm can carry out its plans and achieve its goals, definition of

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Coordination and resource allocation are key components of organizing a business so that it may carry out its plans and accomplish its objectives.

Is the procedure of planning, organizing, and allocating a firm's resources to carry out its strategies?

Organizing, which is the process of coordinating and assigning a firm's resources in order to carry out its plans, is a second crucial task for managers. The process of organizing involves creating a framework for the firm's employees, departments, and activities. In order to maximize information flow and work process efficiency, managers can structure the firm's structural components. They carry out the following to achieve this separating duties (division of labor), classifying work and personnel (departmentalization), distributing responsibility and power (delegation)

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the application of analytical tools to general-purpose financial statements. the communication of financial information useful for making investment, credit, and other business decisions. general-purpose financial statements only. ratio analysis only. profitability.

Answers

True.

How do financial statements work?

An organization's financial results, financial condition, and cash flows are all summarized in its financial statements. The balance sheet, cash flow statement, and income statement are a few of them.

What Drawbacks Are There to Financial Statements?

Issuing financial statements has a few drawbacks. They may be fraudulently manipulated, giving investors to assume that the issuing firm has achieved better performance than was actually the case. This is a potential worry. A lender may offer debt to a company that cannot reasonably repay it as a result of such manipulation. Financial statements are totally historical in nature, which makes them potentially misleading when used to forecast future corporate performance.

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True. The application of analytical tools to general-purpose financial statements.

How do financial statements work?

An organization's financial results, financial condition, and cash flows are all summarized in its financial statements. The balance sheet, cash flow statement, and income statement are a few of them.

What Drawbacks Are There to Financial Statements?

Issuing financial statements has a few drawbacks. They may be fraudulently manipulated, giving investors to assume that the issuing firm has achieved better performance than was actually the case. This is a potential worry. A lender may offer debt to a company that cannot reasonably repay it as a result of such manipulation. Financial statements are totally historical in nature, which makes them potentially misleading when used to forecast future corporate performance.

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according to our understanding of integrated marketing communications, which of the following is not an example of one of the 10 rules of integration?

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According to our understanding of integrated marketing communications, of the following is not an example of one of the 10 rules of integration start with a large budget.

How ought a novice to establish a budget?

Set some objectives.

Establish your income.

Establish your costs.

Establish a budget.

Initially, pay yourself!

Be cautious when using credit cards.

Regularly check back.

How do you begin a strict spending plan?

First, figure out your net income. Your net income is the basis of an efficient budget.

Next, keep tabs on your spending.

Step 3 is to make practical goals.

Make a plan in step four.

5. Modify your expenditures to keep inside your spending limit.

Step 6: Regularly review your spending plan.

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evaluating manager's performance based solely on financial measures has limitations. therefore, companies should consider using measures to help evaluate manager performance.

Answers

The limits of using simply financial measurements. Measures of Non-Financial Performance Evaluation Companies may evaluate the performance of division managers using non-financial indicators.

What is the significance of performance management?

Businesses need effective performance management. They are able to integrate their systems, resources, and personnel with their strategic goals through both formal and informal approaches.

What kinds of management by performance are there?

Performance reviews, key performance indicators (KPIs), and management dashboards are a few examples of performance management procedures or instruments. Performance management is essentially what businesses undertake to increase their success and keep a step ahead of the competition.

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If the Fed purchases government securities from commercial banks, the reserves of the banking system will immediately

Answers

If Fed purchases government securities from commercial banks, reserves of banking system will immediately increase by amount of the purchase.

What is a government securities?

A variety of investment products provided by a governmental organization are referred to as "government securities" in the world of investing. The majority of readers are likely to be most familiar with the Treasury bonds, banknotes, and notes that the U.S. Treasury issues. However, these debt instruments will be issued by numerous governments in order to finance ongoing expenses. The full return of investment principal is guaranteed when government securities reach maturity. Additionally, periodic interest or coupon payments may be made on some government securities. As they are backed by the government who issued them, these securities are regarded as conservative investments with low risk.

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assume the market for orange juice is perfectly competitive. orange juice producers currently earn a zero economic profit. orange juice producers will likely begin to incur economic losses in the short run, and some producers will exit the industry until those remaining earn a zero economic profit, if consumers .

Answers

Use orange juice though rather than grape juice.

Why do perfectly competitive firms make zero economic profit in the long run?

In a perfectly competitive market, businesses can only make or lose money in the short term. Because an infinite number of enterprises generate uniform, infinitely divisible things, revenues and losses are ultimately eliminated.

How do you calculate economic profit in perfect competition?

Based on its total revenue and total cost curves, a perfectly competitive organization, like the raspberry farm, can estimate the amount of output that will generate the highest level of profit. Earnings at any given amount is always equal to entire revenue less total costs.

Which of the following best explains why the price marginal cost relationship improves as production increases?

Early in the manufacturing process, the marginal product is significantly small, which results in an incredibly high marginal cost.

Which of the following is true in a perfectly competitive market?

On any criterion, it is impossible to separate one unit of usefulness from another. a speculative extreme that can provide valuable insights but is impossible in practice.

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1. Which is an economic condition that consumer spending usually
measures?

Answers

Consumer spending is mostly influenced by disposable income. People cannot spend money if they do not have enough of it.

How is consumer expenditure measured?

The Consumer Price Index (CPI) tracks changes in prices for significant categories of goods and services. The CPI report shows price changes for a variety of goods, including food, energy, housing, clothing, transportation, health care, leisure, and education. The most popular items' average prices are available.

What effects do consumer purchases have on the economy?

Future economic growth could be threatened if consumers spend too much of their income today due to insufficient savings and investment. Naturally, consumer spending is crucial to businesses. A given company often performs better the more money customers spend there.

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Oscar Ramirez's job has been redesigned. He has more authority and responsibility and feels the job now is very challenging to him. The company has used job _____ to challenge Ramirez.

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Oscar Ramirez's job has been redesigned. He has more authority and responsibility and feels the job now is very challenging to him. The company has used job enrichment to challenge Ramirez.

What is job enrichment?

In management, job enrichment means a strategy that is used to motivate employees by giving them an increased responsibility and variety in their jobs. The idea of job enrichment is to allow employees to have more control over their work, so, they can tap into their natural desire to do a good job and contribute to the overall goals of the company.

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kingcade corporation keeps careful track of the time required to fill orders. data concerning a particular order appear below: hours wait time 19.1 process time 1.9 inspection time 0.9 move time 2.8 queue time 9.9 the throughput time was: multiple choice 34.6 hours 5.6 hours 29.0 hours 15.5 hours

Answers

The throughput time of kingcade corporation equals to 15.5 hours. The Option D is correct.

What is throughput time?

In manufacturing, throughput time means the total amount of time that it takes to run a process in its entirety from start to finish.

The computation of the throughput time goes as thus:

Particulars                   Time

Inspection time            0.9

Add: Process time       1.9

Add: Move time           2.8

Add: Queue time         9.9

Throughput time         15.5

Therefore, the throughput time of the corporation is 15.5 hours.

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Rainbow Painters is considering a production line approach to empower its employees. The production line approach will be appropriate for this company if:
its employees need to generate ideas and process solutions.
tasks are more standardized and routine.
a longer-term, one-on-one customer relationship is most important.
the work environment is highly dynamic.

Answers

The production line approach is most suitable for tasks that are more standardized and routine. This reduces the need for employees to generate ideas or process solutions and allows them to focus on efficiency and productivity.

Improving Efficiency Through a Production Line Approach at Rainbow Painters

The production line approach will be appropriate for this company if: Tasks are more standardized and routine.

The production line approach is well suited to Rainbow Painters, as it can help to streamline the painting process by allowing employees to specialize in specific tasks. This will lead to more efficient production as employees become more familiar with their tasks and can focus on productivity. The standardized and routine nature of production line tasks also reduces the need for employees to generate ideas or process solutions, allowing them to focus on efficiency instead.

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If the marginal utility of each good consumers buy does not diminish but remains constant, we should witness consumers: a. buying no goods at all. b. spending all of their income on the good with the highest MU.
c. buying one of each good.
d. buying only the least expensive goods.
e. become indifferent to what goods they buy.

Answers

With each extra unit of a good consumed, the marginal utility will decrease, according to the concept of decreasing marginal utility.

What is the marginal significance?

When anything is described as peripheral, it is insignificant or small. This is a slight improvement over October. Synonyms: negligible, little, low, and inconsequential more adjective synonyms for marginal.

What is meant by marginal at best?

Of a value, or of a quality that embodies a value, that borders on being intolerable or likely to cause exclusion from just a group or a category. His writing skills were at most marginal, and since the utility of each thing customers purchase does not decline but instead stays constant, we should observe consumers.

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You were considering buying a camera 1 month ago from Japan which was priced at 150,000 yen If the exchange rate has changed from 1 usd A 135 yen one month ago to 1 usd = 141 yen today, hiow much in dollars will you 5 ave if you buy the camera foday?

Answers

An exchange rate is the relative price of one currency in terms of another (or group of currencies). The exchange rate is an important economic variable for economies that engage in international trade, such as Australia.

In comparison to other countries, higher interest rates provide lenders in an economic with a higher return.. As a result, rising interest rates attract foreign capital, causing the exchange rate to rise. Currency exchange rates can be either fixed or floating. The fixed exchange rate is determined by the country's central bank, whereas the floating rate is determined by market demand and supply dynamics.

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What is the reason that a real-world bank would not deposit all of its cash in the Federal Reserve Bank? Banks require excess reserves to enable lending and earn income interest.

Answers

In order to facilitate lending and generate interest income, banks need extra reserves and so a real-world bank would not deposit all of its cash in the Federal Reserve Bank

What is the Federal Reserve Bank?

The country's safe, adaptable, and stable monetary and financial system is provided by the Federal Reserve, the country's central bank. The Federal Reserve Banks offer crucial financial services to the country's payment system, such as delivering currency to banks and clearing checks. In reaction to changes in the public's demand for currency, money and coins are either added to or removed from circulation. Federal Reserve Banks are frequently referred to as "bankers' banks" since they offer commercial banks services that are comparable to those that commercial banks offer to their clients. Federal Reserve Banks provide banks with cash and coins, lend to banks, and handle electronic payments.

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