Owen expects to receive at the end of next year from a trust fund. If a bank loans money at an interest rate of ​, how much money can he borrow from the bank on the basis of this​ information?

Answer:

Option A. 0.79

Explanation:

All we have to do is convert the levered beta into unlevered beta (100% equity financed). So we will use the following formula to find unlevered beta:

Unlevered Beta = Levered Beta /  (1   +  (1+T)* D/E)

Here,

Tax rate is 40%

Debt is 40%

Equity is 60%

And Levered Beta is 1.10

Now by putting values, we have:

Unlevered Beta =     1.10   / (1   +  (1 - 0.4)* 40% / 60%)

Unlevered Beta =     1.10  / (1 +   0.6 * .667)

Unlevered Beta =     1.10  / (1 +    0.4)

Unlevered Beta =     1.10  / (1.4)

Unlevered Beta =     0.786 which after rounding off we have 0.79

Answer:

Out the money.

Explanation:

A PHLX Jan 80 Swiss Franc Call contract is quoted at 2 when the Swiss Franc closes at 77. The contract is out the money.

An out the money ultimately implies that an option only has an extrinsic value but no intrinsic value. The extrinsic value of an option refers to the difference between its intrinsic value and the market value (premium). An extrinsic value is affected by the volatility in the market and its time value. The intrinsic value of an asset refers to the calculated, true or real value of an asset and is solely affected by internal factors.

A call is out the money when the strike price is greater than or above the underlying price of an asset. This simply means that, it's market value (price) has fallen below its strike price.

In this scenario, the market price of the call is 77 while its strike price is 80; thus, the call option is out the money by 3.

Answer:

The question here is that of the balance of trade and the principles of demand and supply.  

According to the Economics principles of demand and supply, when demand is high, prices follow in the same direction and the currency appreciates in value.

So, on one hand, when the demand for Australia's natural resources increases, because the legal tender recognised within Australia's borders is its own currency, trading partners are forced to convert from their currency into the Australian dollars thus creating an increased demand for the currency.

On the other hand, if the value of a countrys imports is more than the value of its export transactions, the opposite would happen, that is, its currency depreciates or loses value.

Cheers!

Answer:

The company will decide to build the factory if the interest rate is 12.47 %.

Explanation:

The required interest rate r, can be determined as follows ;

PV = - $125 million

n = 4

Pmt = $0

P/yr = 1

FV = $200 million

r = ?

Using a Financial Calculator, the required interest rate r, is 12.4683 or 12.47 % (2 decimal places)

Answer:

for anniversary = 125

for wedding = 112.5

anniversary

Explanation:

Labour productivity = number of meals / total number of workers

for anniversary = 375 / 3 = 125

for wedding = 225 / 2 = 112.5

labour productivity is higher for the anniversary because one unit of labour produces more meals when compared to the wedding.

Answer:

False

Explanation:

This is false.

In reporting reserves aggregate there are lags interest rate such as the federal interest rate are quite easy to measure and easily observable. Such short term interest rate are nominal values and they do not measure the real cost of borrowing well. It does not show accurately what happens to Gross domestic product. Real interest rate equals nominal interest rate as a ratio of reduced inflation gives a representation of true cost of borrowing.

We cannot say with certainty that interests rate is a better policy instrument based on the ground of measurability.

Answer:

C

Explanation:

D / V = 1000 / 4000

Dividing 1000 by 4000 gives 0.25 = 25%

E / V = 3000 / 4000

Dividing 3000 by 4000 gives 0.75 = 75%

Answer:  $19

Explanation:

The Contribution Margin is defined as the Sales the Variable costs.

The Contribution Margin per patron is therefore;

= Ticket Price - Variable Cost which is the cost of dinner

= 40 - 21

= $19

Answer:

All the requirements are solved below

Explanation:

Purchase = $178,000

Ready to use cost = $2,480

Installation cost = $1,160

Salvage value = $14,000

Depreciation method = Straight line

Useful life = 6 years

Solution

Requirement A If sold for $22,000

Entry                                               DEBIT      CREDIT

Cash                                            $22,000

Accumulated depreciation       $140,000

Profit/loss on disposal               $20,000

Machinery                                                       $182,000

Requirement B If sold for $88,000

Entry                                             DEBIT        CREDIT

Cash                                            $82,000

Accumulated depreciation       $140,000

Profit/loss on disposal                                   $40,000

Machinery                                                       $182,000  

Requirement C If destroyed in fire and insurance company paid $32,500

Entry                                             DEBIT      CREDIT

Cash                                            $30,000

Accumulated depreciation       $140,000

loss from fire                              $12,000

Machinery                                                       $182,000

Workings

Cost =$178,000 + $2,480 + $1,160

Cost = $182,000

Accumulated depreciation = ([tex]\frac{182,000-14,000}{6}x5[/tex]

Accumulated depreciation = 140,000

Answer:

$16.96 million

Explanation:

The computation of the amount of warranty expense is shown below:

= Net sales made under warranty in year 2021 × expected cost percentage to net sales

= $212 million × 0.08

= $16.96 million

We simply multiplied the net sales with the expected cost percentage so that the amount of warranty expense could come and the same is to be considered

Answer:

D

Explanation:

Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested

IRR can be calculated with a financial calculator  

Cash flow in year 0 = $-109,332

Cash flow each year from year 1 to 4 = $36,000

IRR = 12%

To find the IRR using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.  

Answer:

Dr Salaries expense 40,000

Cr FICA - Social security taxes payable 2,480

Cr FICA - medicare taxes payable 580

Cr Employee medical insurance deduction 593

Cr Union dues 230

Cr Salaries payable 33,017

Cr Federal income taxes payable 3,100

Explanation:

Preparation of the journal entry to record North Company’s January 15 salaries expense and related liabilities

Jan 15

Dr Salaries expense 40,000

Cr FICA - Social security taxes payable 2,480 (6.2%*40,000)

Cr FICA - medicare taxes payable 580

(1.45%*40,000)

Cr Employee medical insurance deduction 593

Cr Union dues 230

Cr Salaries payable 33,017

Cr Federal income taxes payable 3,100

Salaries payable is calculated as:

Salaries expense 40,000

Less: FICA - Social security taxes payable (2,480)

FICA - medicare taxes payable (580)

Employee medical insurance deduction (593)

Union dues (230)

Federal income taxes payable (3,100)

=$33,017

Here, we are to prepare the journal entry to record North Company’s January 15 salaries expense and related liabilities.

Salaries payable = Salaries expense - FICA - Social security taxes payable - FICA - medicare taxes payable - Employee medical insurance deduction - Union dues - Federal income taxes payable

Salaries payable = $40,000  - $2,480 - $580 - $593 - $230 - $3,100

Salaries payable = $33,017

Date     Account titles and Explanation                 Debit      Credit

Jan 15   Salaries expense                                       $40,000

                FICA - Social security taxes payable                       $2,480

                (6.2%*40,000)

                FICA - medicare taxes payable                                $580

                (1.45%*40,000)

                Employee medical insurance deduction                 $593

                Union dues                                                                 $230

                Salaries payable                                                         $33,017

                Federal income taxes payable                                  $3,100

             (To record salaries expense and related liabilities)

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The failure of quality circles is not because management refuses to listen to the quality improvement ideas of subordinates.

Quality circles refer to a method that helps in encouraging group involvement.

The major reason for the failure of quality circles is because of the rejection of the concept by top management, labor turnover, lack of cooperation from middle and first-line managers, etc.

Therefore, the above statement is false.

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Answer:

Option  D is correct

Machine B is the best investment

Explanation:

The accounting rate of return is the average annual income expressed as a percentage of the average investment.  

The simple rate of return can be calculated using the two formula below:

Accounting rate of return  =

Annual operating income/Average investment × 100

To determine the the machine with the best return,we would compute the average annual return of all of the machines and then choose the machine with the highest return

This is done as follows:

Machine             Working s                                   Average annul rate

A                   45,192.56/322,804.00 ×   100 =      14.0%

B                64,695.00/215,650.00 ×   100=           30.0%

C                  60,929.70/406,198.00×   100 =          15.0%

Machine B is the best investment

Answer: I and II

I. American Opportunity Tax Credit

II. Lifetime Learning Credit

Explanation:

From the question, we are informed that Michael and Kathy have one dependent, Dustin, who is in his third year of college and that Michael is taking classes in the evening toward an MBA.

The credits that Michael and Kathy can claim related to tuition they pay for these programs are American Opportunity Tax Credit and the Lifetime Learning Credit.

Answer:

functional finance.

Explanation:

The budget philosophy of functional finance implies that the government should do all that is necessary in order to make the economy operate at full potential. The outcomes of whatever budget preparations are ignored in philosophy of functional finance. What is most paramount is to focus on whatever that would bring growth and stability to the economy.

In the philosophy of functional finance, what is most important about balancing the federal budget is its use to promote an economy so that it can operate at full potential.

Answer:

The structural budget in 2010 is $100 billion

Explanation:

Actual deficit = Government spending - Tax Revenue Collection  

i.e Actual deficit = G-T

T = (Tax rate) (Actual output)

$400 billion = G - (0.15)($6000 billion)

$400 billion = G - $900 billion

G =  $400 billion + $900 billion

G =  $1300 billion

Thus, Government spending is $1300 billion

Structural deficit = G - T'

T' = (Tax rate)(Potential output)

T' = (0.15)(8000 billion)

T' = $1200 billion

Structural deficit = G - T'

Structural deficit = $1300 billion - $1200 billion

Structural deficit = $100 billion

Thus, the structural budget in 2010 is $100 billion

Complete Question:

Edna is a leading brain surgeon in the United States. She enters into a contract to perform a complicated brain surgery on Ben. However, since Edna is very busy, she wants to assign this contract to a less experienced surgeon, Charles. This would be Charles's first operation of this type. Ben can object to this assignment and prevent it because the contract between Ben and Edna is a(n):

Group of answer choices.

A. contract for services to be performed in the future.

B. contract involving personal skill.

C. services contract.

D. employment contract.

Answer:

B. contract involving personal skill.

Explanation:

In this scenario, Edna a leading brain surgeon in the United States enters into a contract to perform a complicated brain surgery on Ben. However, Edna is very busy and wants to assign this contract to a less experienced surgeon, Charles which would be his first operation of this type. Hence, Ben can object to this assignment (brain surgery) and prevent it because the contract between Ben and Edna is a contract involving personal skill.

Apparently, it can be deduced that Edna has competent and professional skills which is the reason why she's the leading brain surgeon in USA. Ben having this information at his disposal chose to go into the contract with Edna, who is an experienced brain surgeon. Therefore, the contract between the two (2) parties is solely based on Edna's personal skill.

Answer:

Break-even point in units= 6,547 units

Explanation:

Giving the following information:

Selling price per unit $160

Variable expense per unit $91.50

Fixed expense per month $429,490

Desired profit= $19,000

To calculate the number of units to be sold, we need to use the break-even point formula:

Break-even point in units= (fixed costs + desired profit) / contribution margin per unit

Break-even point in units= (429,490 + 19,000) / (160 - 91.5)

Break-even point in units= 6,547 units

Answer:

1)

a. Raw materials purchased for cash, $170,000.

Dr Materials inventory 170,000

   Cr Cash 170,000

b. Raw materials requisitioned for use in production, $141,000 (materials costing $121,000 were charged directly to jobs; the remaining materials were indirect).

Dr Work in process: direct materials 121,000

Dr Manufacturing overhead 20,000

    Cr Materials inventory 141,000

c. Costs for employee services were incurred as follows:

Dr Work in process: direct labor 156,000

Dr Manufacturing overhead 185,900

Dr Sales salaries expense 22,000

Dr Administrative salaries expense 50,000

    Cr Cash 413,900

d. Rent for the year was $18,800 ($13,600 of this amount related to factory operations, and the remainder related to selling)

Dr Manufacturing overhead 13,600

Dr Rent expense 5,200

    Cr Cash 18,800

e.Utility costs incurred in the factory, $16,000.

Dr Manufacturing overhead 16,000

    Cr Cash 16,000

f. Advertising costs incurred, $13,000.

Dr Advertising expenses 13,000

    Cr Cash 13,000

g. Depreciation recorded on equipment, $21,000. ($15,000 of this amount was on equipment used in factory operations; the remaining $6,000 was on equipment used in selling and administrative activities.)

Dr Manufacturing overhead 15,000

Dr Depreciation expense 6,000

    Cr Accumulated depreciation: manufacturing equipment 15,000

    Cr Accumulated depreciation: office equipment 6,000

h. Manufacturing overhead cost was applied to jobs, $?

Dr Work in process 265,200

     Cr Manufacturing overhead 265,200 (170% of direct labor)

i. Goods that had cost $226,000 to manufacture according to their job cost sheets were completed.

Dr Finished goods inventory 226,000

    Cr Work in process 226,000

j. Sales for the year totaled $514,000. The total cost to manufacture these goods according to their job cost sheets was $220,000.

Dr Cash 514,000

    Cr Sales revenue 514,000

Dr Cost of goods sold 220,000

    Cr Finished goods inventory 220,000

2)

Dr Manufacturing overhead ($265,200 - $250,500) 14,700

    Cr Cost of goods sold 14,700

3) Gold Nest Company

Income Statement

Sales revenue                                                                        $514,000

- Cost of goods sold                                                             -$205,300

Gross profit                                                                             $308,700

Operating expenses:

Operating profit                                                                        $212,500

1. The preparation of journal entries to record the transactions for Gold Nest Company of Guandong, China, is as as follows:

a. Debit Raw materials $170,000

Credit Cash $170,000

b. Debit Work in Process $121,000

Debit Manufacturing Overhead $20,000

Credit Raw materials $141,000

c. Debit Work in Process $156,000

Debit Manufacturing Overhead $185,900

Credit Payroll Expenses $341,900

Debit Selling and Administrative Expenses $22,000

Credit Sales commissions $22,000

Debit Selling and Administrative Expenses $50,000

Credit Administrative salaries $50,000

d. Debit Manufacturing Overhead $13,600

Debit Selling and Administrative Expenses $5,200

Credit Rent Expenses $18,800

e. Debit Manufacturing Overhead $16,000

Credit Utilities Expense $16,000

f. Debit Selling and Administrative Expenses $13,000

Advertising costs $13,000

g. Debit Manufacturing Overhead $15,000

Debit Selling and Administrative Expenses $6,000

Credit Depreciation Expenses $21,000

h. Debit Work in Process $265,200

Credit Manufacturing Overhead (Applied) $265,200 ($1.70 x $156,000)

i. Debit Finished Goods Inventory $226,000

Credit Work in Process $226,000

j. Debit Cash $514,000

Credit Sales Revenue $514,000

j. Debit Cost of goods sold $220,000

Credit Finished Goods Inventory $220,000

2. The journal entry to close the balance in the Manufacturing Overhead account to the Cost of goods sold is as follows:

Debit Manufacturing Overhead $14,700

Credit Cost of goods sold $14,700

3. Gold Nest Company

for the year ended December 31

Sales Revenue            $514,000

Cost of goods sold      205,300

Gross profit               $308,700

Selling and Administrative Expenses:

Sales commission       $22,000

Administrative salaries 50,000

Rent Expenses                5,200

Advertising Expenses   13,000

Depreciation Expenses 6,000

Total selling/admin.  $96,200

Net income             $212,500

Estimated manufacturing overhead = $76,500

Estimated direct labor dollars = $45,000

Predetermined overhead rate = $1.70 ($76,500/$45,000)

Raw materials = $10,200

Work in process = $4,200

Finished goods = $8,200

a. Raw materials $170,000 Cash $170,000

b. Work in Process $121,000 Manufacturing Overhead $20,000 Raw materials $141,000

c. Work in Process $156,000 Manufacturing Overhead $185,900 Payroll Expenses $341,900

Selling and Administrative Expenses $22,000 Sales commissions $22,000

Selling and Administrative Expenses $50,000 Administrative salaries $50,000

d. Manufacturing Overhead $13,600 Selling and Administrative Expenses $5,200 Rent Expenses $18,800

e. Manufacturing Overhead $16,000 Utilities Expense $16,000

f. Selling and Administrative Expenses $13,000 Advertising costs $13,000

g. Manufacturing Overhead $15,000 Selling and Administrative Expenses $6,000 Depreciation Expenses $21,000

h. Work in Process $265,200 Manufacturing Overhead (Applied) $265,200 ($1.70 x $156,000)

i. Finished Goods Inventory $226,000 Work in Process $226,000

j. Cash $514,000 Sales Revenue $514,000

j. Cost of goods sold $220,000 Finished Goods Inventory $220,000

2. Manufacturing Overhead $14,700 Cost of goods sold $14,700

b. Raw materials                   $20,000

c. Payroll Expenses            $185,900

d. Rent Expenses                 $13,600

e. Utilities Expense              $16,000

g. Depreciation Expenses  $15,000

h. Work in Process                                 $265,200

Cost of goods sold (Over-applied

overhead)                          $14,700

Finished goods                                   $220,000

Over-applied manufacturing overhead (14,700)

Adjusted cost of goods sold           $205,300

A job-order costing system is a costing system that tracks the costs and revenues according to jobs, with jobs allocated job numbers.  It is unlike process costing, which tracks jobs for each process in order to determine the unit costs instead of per job.

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Answer:

Is a contra account to bonds payable

Explanation:

Answer:

10.60%

Explanation:

The compound annual growth rate formula stated below can be used to determine the annual rate of return on the stock investment.

CAGR=(future value/present value)^(1/n)-1

future value is the future worth of the stock after three years i.e100*$23=$2300

Present value is the initial cost of the stock which is 100*$17=$1700

n is the number of years the stocks have been owned

CAGR=($2300/$1700)^(1/3)-1=10.60%

Answer:

Operating activities

Explanation:

The operating activities in the cash flow statement using the direct method derive that the cash receipts and the cash payment should be recorded under this activity.

Cash payment would be recorded when the purchase of merchandise is held

And cash received would be recorded when the sale of goods and services made to customers

And, the purchase of goods, sales of goods and services show in the income statement along with the expenditure to arrive at the net income i.e. shown in the operating activities

the answer is this true

A firm is using experience curve pricing when it prices high worldwide in an attempt to position itself as a market leader is a false statement.

Pricing for Experience Curve is Depending on the company's level of expertise in creating the goods, the price is set. Every time a corporation doubles its expertise in creating a product, the cost of selling that product or service drops by 10% to 30%.

A business can use less time and resources or produce products more effectively as it gains experience. As a result, it may provide a lower price since costs are reduced.

The pricing of a product at a lower than average-cost level on the theory that costs will reduce as manufacturing expertise improves allows the product to become cheaper as it continues through the product life cycle.

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Answer:

4.67 years.

Explanation:

PB = Years before cost recovery + (Remaining cost to recover ÷ Cash flow during the year)

= 4 + ($2,000 / $3,000)

= 4.67 years.

Answer:

True.

Explanation:

The 2019 Budgetary Comparison Schedule will include the $25,000 whether or not the encumbrances lapse at the year-end, either as outstanding encumbrances or settled encumbrances.  These $25,000 encumbrances are budget reservations of appropriations so that they can be used to settle specified expenditures in the future.  The purpose of making these reservations is to signal that the expenditures have been earmarked so that their cash allocations are not used for other purposes.

Answer:

$1.75

Explanation:

Value added is calculated by subtracting the difference of revenue and the cost of inputs.

value added of Florida Jam Company = $2.50 - $0.75 = $1.75

Answer:

Payback period=2 years 5  months

Payback period=3 years  8 months

Explanation:

The payback period is the estimated length of time in years it takes  .

It is the number of years it takes the cash project to break-even

a) Payback period

Total cash flow for two years = 750×  2 = 1500.000

Balance of cash flow required to make up= 1800000- 1500,000  300,000

Payback period = 2 years + 300,000/750,000× 12 months=  2 years 5  months

Payback period=2 years 5  months

b) Payback period

Total cash flow for 3 years = 450,000 + $225,000 +600,000=1,275 ,000

Balance o cash required to make up 1800,000 = 1,800,000 -1275,000= 525,000

Pay back period = 3 years + 525,000/750,000×  12 months

                            = 3 years  8 months

Payback period=3 years  8 months

A company stocks an SKU with a weekly demand of 600 units and a lead time of 4 weeks. There are 52 weeks in a year. Management will tolerate 1 stock out per year. If sigma for the lead time is 100 and the order quantity is 2500 units, what is:  the safety stock, the average inventory, and the order point?

Answer:

The safety stock = 142 units

The average inventory = 1392 units

The order point = 2542 units

Explanation:

Given that:

the weekly demand = 600 units

lead time = 4 weeks

sigma for the lead time (i.e the standard deviation [tex]\sigma[/tex] ) = 100 units

Order quantity = 2500 units

The objective is to calculate :

the safety stock, the average inventory, and the order point?

To start with the number of order per year.

The number of order per year = Annual demand/Order quantity

The number of order per year =  (Weekly demand × 52)/ Order quantity

The number of order per year =  (600 × 52)/2500

The number of order per year =  31200/2500

The number of order per year = 12.48 times /year

Also, the service level for the safety factor = (Number of order per year - 1)/ number of order per year

the service level for the safety factor = ( 12.48 - 1)/12.48

the service level for the safety factor = 11.48/12.48

the service level for the safety factor = 0.9199

the service level for the safety factor = 91.99%

∴ the safety factor at 91.99% service level = (safety factor at (90% +94%))÷2

the safety factor at 91.99% service level = (1.28 +1.56) ÷2

the safety factor at 91.99% service level = 2.84 ÷2

the safety factor at 91.99% service level = 1.42

Now,

the safety stock = 100 × safety factor at 91.99% service level

the safety stock = 100 × 1.42

the safety stock = 142 units

The order point = safety factor +  demand during lead time

where;

The demand during lead time = weekly demand × 4

The demand during lead time = 600  × 4

The demand during lead time = 2400 units

The order point = safety factor +  demand during lead time

The order point = 142 +  2400

The order point = 2542 units

Finally,

The average inventory = (order quantity ÷ 2) + safety stock

The average inventory = (2500 ÷ 2) + 142

The average inventory =1250 +142

The average inventory = 1392 units

Answer:

Opportunity cost = $192,900

Explanation:

The opportunity cost is the "cost" incurred by not enjoying the benefit associated with the best alternative choice

DATA

Current value = $212,900

Selling expense = $20,000

Opportunity cost = Current value - selling expense

Opportunity cost = $212,900 - $20,000

Opportunity cost = $192,900

Here Sue is Decide to convert the house into professional office space she would lose te opportunity cost of $192,000