precise Machinery is analyzing a proposed project that is expected to sell 1,450 units, +3 percent. The expected variable cost per unit is $139 and the

Answers

Answer 1

Answer: C.$221.86

Explanation:

Contribution Margin is the difference between the sales price and the variable costs.

Best case scenario of Sales would mean it is the higher amount.

Best case scenario of costs would mean the lower amount.

Best case Sales

= 349 * ( 1 + 3%)

= $359.47

Best Case Variable Cost

= 139 * ( 1 - 1%)

= $137.61

Best Case Contribution Margin

= Best case Sales  - Best Case Variable Cost

= 359.47 - 137.61

= $221.86


Related Questions

Polly Khan is trying to calculate the current market rate given the following information: Investor’s have been requiring a 12% annual return on Builtrite’s stock which has a beta of 2.0 and the current risk-free rate is 4%. What is the current market rate?

Answers

Answer:

The current market rate is 8%

Explanation:

The market rate is the return on market or the market portfolio. To calculate the market rate (rM) we will use the CAPM equation which is used to calculate the required rate of return on a stock or portfolio. The formula for required rate of return under CAPM is,

r = rRF + Beta * (rM - rRF)

Where,

rRF is the risk free raterM is the market rate

We already know the value of r, rRF and Beta. We will input these values in the above equation to calculate the market rate.

0.12 = 0.04 + 2 * (rM - 0.04)

0.12 - 0.04 = 2 * rM - 0.08

0.08 + 0.08 = 2 * rM

0.16 / 2 = rM

rM = 0.08 or 8%

The central problem in product-oriented layout planning is?

Answers

Answer: The minimizing the imbalance in the workloads among workstations.

Explanation:

Workspace can inspire informal and productive encounters if it balances what three physical and social aspects.

Coffer Co. is analyzing two potential investments.

Project X Project Y
Cost of machine $77,000 $55,000
Net cash flow:
Year 1 28,000 2,000
Year 2 28,000 25,000
Year 3 28,000 25,000
Year 4 0 20,000

If the company is using the payback period method and it requires a payback of three years or less, which project(s) should be selected?

a. Project Y
b. Both X and Y are acceptable projects.
c. Project Y because it has a lower initial investment
d. Project X
e. Neither X nor Y is an acceptable project

Answers

Answer:

d. Project X

Explanation:

For Project X

Year       Net cash outflow             Net cash inflow Balance

0              -$77,000                        -$77,000

1               $28,000                        -$49,000

2               $28,000                       -$21,000

3                $28,000                        $7,000

4                    0                               $7,000

Payback period = 2 + $21,000 ÷ $28,000

= 2 + 0.75

= 2.75 years

For Project Y

Year       Net cash outflow          Net cash inflow Balance

0              -$55,000                       -$55,000

1                $2,000                         -$53,000

2               $25,000                       -$28000

3                $25,000                       -$3,000

4                $20,000                       $17,000

Payback period = 3 +3,000 ÷ 20,000

= 3 + 0.15

= 3.15 years

Project X has a lesser than 3 year payback period. So, the correct option is D

3. At an oral auction for a lamp, half of all bidders have a value of $50 and half have a value of $70. What is the expected winning bid if there are four bidders

Answers

Answer: $60

Explanation:

From the question, we are informed that At an oral auction for a lamp, half of all bidders have a value of $50 and half have a value of $70.

The expected winning bid if there are four bidders goes thus:

Since there are four bidders, the probability that the winning bid is $50 is 1/2 and for $70, it's 1/2 as well based on the question.

The expected winning bid will now be:

= ($50 × 1/2) + ($70 × 1/2)

= ($50 × 0.5) + ($70 × 0.5)

= $25 + $35

= $60

Which of the following is true regarding warranties under common law? Select one: A. Express warranties, the implied warranty of assignability, and warranties of title arise automatically under common law. B. Only the implied warranty of merchantability arises automatically under common law. C. Only warranties of title arise automatically under common law. D. For a warranty to exist, it must first be requested by the buyer. E. Only the implied warranty of assignability arises automatically under common law.

Answers

Answer: E. Only the implied warranty of assignability arises automatically under common law

Explanation:

Implied warranty is a term that is used in common law to refer to assurance that are given to a a product that the said product is fit and in good condition for the purpose it'll be used for.

Of all the options that are given, the one that is true regarding warranties under common law is that only the implied warranty of assignability arises automatically under common law.

At an output level of 415,400 units, you have calculated that the degree of operating leverage is 2.00. The operating cash flow is $58,000 in this case. Ignore the essect of taxes. What will be the new degree of operating leverage for output levels of 16,400 units and 14,400 units

Answers

Answer:

the new degree of operating leverage for output levels of 16,400 units and 14,400 units will be -0.0858  and - 0.0745 respectively.

Explanation:

From the given information:

the degree of operating the leverage at 415,400 units = [tex]\mathtt{\dfrac{contribution \ \ margin}{operating \ \ income}}[/tex]

where contribution margin = 2 × 58000 =116000

If we assume that the sales price should be p and the variable cost  be q per unit .

Then, 415,400p - 415,400q = 116000

p - q = [tex]\mathtt{\dfrac{116000}{415400}}[/tex]

p - q = 0.279  at 415400 unit

Contribution margin = 415400 × 0.279

Contribution margin = 115896.6

The operating income = contribution margin - fixed expense

58000 = 115896.6 - fixed expense

fixed expense = 115896.6 - 58000

fixed expense = 57896.6

However, when the output level is 16400 unit,

the contribution margin = 16400(p-q)

the contribution margin =  16400(0.279)

the contribution margin = 4575.6

The operating leverage = [tex]\mathtt{\dfrac{contribution \ \ margin}{contribution \ \ margin - fixed \ \ costs}}[/tex]

The operating leverage = [tex]\mathtt{\dfrac{4575.6}{4575.6 - 57896.6}}[/tex]

The operating leverage = [tex]\mathtt{\dfrac{4575.6}{-53321}}[/tex]

The operating leverage = -0.0858

when the output level is 14400 unit,

the contribution margin = 14400(p-q)

the contribution margin =  14400(0.279)

the contribution margin = 4017.6

The operating leverage = [tex]\mathtt{\dfrac{contribution \ \ margin}{contribution \ \ margin - fixed \ \ costs}}[/tex]

The operating leverage = [tex]\mathtt{\dfrac{4017.6}{4017.6 - 57896.6}}[/tex]

The operating leverage = [tex]\mathtt{\dfrac{4017.6}{-53879}}[/tex]

The operating leverage = - 0.0745

White Lion Homebuilders is considering investing in a one-year project that requires an initial investment of $475,000. To do so, it will have to issue new common stock and will incur a flotation cost of 2.00%. At the end of the year, the project is expected to produce a cash inflow of $595,000. The rate of return that White Lion expects to earn on its project (net of its flotation costs) is:___________.

Answers

Answer:

22.81%

Explanation:

The computation of the rate of return is shown below:

= (cash inflow ÷ total cost) - 1

where,

Cash inflow is $595,000

And, the total cost is

= $475,000 + $475,000 × 2%

= $475,000 + $9,500

= $484,500

So, the rate of return is

= ($595,000 ÷ $484,500) - 1

= 22.81%

Hence, the rate of return is 22.81%

Basically we applied the above formulas

True or false: A flexible budget reporting sales volumes at three different levels will have the same fixed costs.

Answers

Answer:

True

Explanation:

A flexible budget is a budget in which you modify the activity levels to reflect changes in sales to help the company adjusts to different circumstances that may occcur. Also, in this budget the fixed costs remain constant and the variable costs change with the activity levels. According to this, the answer is that the statement that says that a flexible budget reporting sales volumes at three different levels will have the same fixed costs is true.

It is true that a flexible budget presenting sales volumes at three levels would have the same fixed expenses.

Flexible budget:

A flexible budget is one in which activity levels are adjusted to reflect sales performance, allowing the organization to respond to unforeseen events.

Furthermore, in this budget, fixed expenditures stay constant while variable costs vary according to activity levels. The assumption that a flexible budget reporting sales volumes at three distinct levels will have the same fixed expenses.

Find out more information about 'Flexible budget'.

https://brainly.com/question/25353134?referrer=searchResults

Firm A has set an MSRP of MXN 25 for its product, and the average discount to distributors is 30%. What is revenue on 40 million units

Answers

Answer: 700 million

Explanation:

From the question, we are informed that Firm A has set an MSRP of MXN 25 for its product, and the average discount to distributors is 30%.

The revenue on 40 million units will be calculated as:

= (40,000,000 × 25) × (100% - 30%)

= 1,000,000,000 × 70%

= 1,000,000,000 × 0.7

= 700,000,000

The answer is 700 million.

The revenue on 40 million units is 700,000,000.

The calculation is as follows:

= (40,000,000 × 25) × (100% - 30%)

= 1,000,000,000 × 70%

= 1,000,000,000 × 0.7

= 700,000,000

Therefore we can conclude that The revenue on 40 million units is 700,000,000.

Learn more; brainly.com/question/6201432

In a partnership liquidation, the final cash distribution to the partners should be made in accordance with the

Answers

Answer: B) balances of the partners' capital accounts.

Explanation:

Final cash distributions should be made proportionally to partners based on what they have in their Capital Accounts.

The balance in the Capital accounts of Partners shows the level of contribution that each partner has made to the business as well as their ownership proportion. When cash is to be distributed finally, it should therefore be based on the proportion of these Capital account balances to reflect the contribution and ownership.

A perpetuity provides for continuous payments. The annual rate of payment at time t is { 1, 0 <= t <10 (1.03)^t-10, t >=10 Using an annual effective interest rate of 6%, the present value at time t = 0 of this perpetuity is x. Calculate X. a. 27.03 b. 30.29 c. 34.83 d. 38.64 e. 42.41

Answers

Answer:

b. 30.29

Explanation:

Perpetuity is the state that lasts forever. In statistics the benefit that last for an indefinite period of time is calculated through perpetuity method.  

1/1.06 + 1/1.06^2 +1/1.06^3 + 1/1.06^4 + 1/1.06^5 + 1/1.06^6 + 1/1.06^7 + 1/1.06^8 + 1/1.06^9 =

0.942 + 0.893 + 0.87 + 0.821 + 0.791 + 0.752 + 0.691 + 0.652 + 0.604

=  7.017

7.017 / 0.23 = 30.29

If a municipality is expecting to receive federal funding for mass-transit programs, it could borrow against the expected funds to be received by issuing:_____.
A. BANs.
B. TANs.
C. GANs.
D. CLNs.

Answers

Answer:

Option C (GANs) is the correct answer.

Explanation:

GAN refers to "Grant Anticipation Notice". This can indeed be distributed by a municipality or community to "move forward" as well as make the proper use of another government grant extra funds expected future economic in the years ahead. Those other state grant monies are being used for investments in mass transportation, energy efficiency, including environmental regulations.

The other three alternatives are not related to the given instance. So that the above would be the appropriate one.

Discuss and analyze a situation where you worked on a team/ project team consisting of diverse or intercultural team members
a. What were some good and/or poor examples of communication?
b. Discuss any examples or interpretation of cultural differences as described in Hoftstede's Cultural Values chart on p. 46 of your text (i.e. individualism, time orientation, formality, etc.).
c. Is there anything that could have been done to make the communication more effective?

Answers

Explanation:

a. What were some good and/or poor examples of communication?

Intercultural communication in the workplace can generate some significant difficulties, in an intercultural work team, there may be behaviors of certain members that differ from the rest of the group, which can mean lack of integration of the team due to lack of respect and interest to the cultural values ​​of a particular member.

b. Discuss any examples or interpretation of cultural differences as described in Hoftstede's Cultural Values chart on p. 46 of your text (i.e. individualism, time orientation, formality, etc.).

Formality can be interpreted differently according to different cultures. In a more flexible culture like the American one, for example, formality may not be so expressed through the use of formal language and dress, whereas in a less flexible culture, this can be seen as a disrespect, as they can establish a more serious and formal communication in the workplace.

c. Is there anything that could have been done to make the communication more effective?

To make intercultural communication more effective, it is necessary above all to respect the individual values ​​of an individual that exist in certain ways in some situations. The ideal is that people are open to learn and exchange experiences, willing to help the individual to integrate into the group, and above all to act in an ethical and respectful way always.

In an international communication process carried out by a company, the sales force of the company that conveys the encoded message to the intended receiver acts as a(n)

Answers

Answer: message channel

Explanation:

In an international communication process carried out by a company, the sales force of the company that conveys the encoded message to the intended receiver acts as a message channel.

The sales force are said to act as a.mesage channel because they are the ones that pass the message across to the intended receiver.

Using the tables above, what is the present value of $6,000 to be received at the end of each of the next four years, assuming an earnings rate of 10%?
a. $20,790
b. $19,020
c. $14,412
d. $25,272
1. Option A
2. Option B
3. Option C

Answers

Answer:

b. $19,020

Explanation:

Note: This question is not complete. The complete question is therefore provided in the attached pdf file before answering the question. Please, see the attached file for the full question.

Also note that the "1. Option A 2. Option B 3. Option C" are not actually part of the question.

The explanation to the answer is now provided as follows:

Note: This is an example of annuity. An annuity can be described as a series of payments made or income received at equal intervals.

Therefore, the relevant table in the question is the second table, i.e. table for the present value of an annuity of $1 at compound interest.

To calculate the present value (PV), the following for formula is used:

PV = ACI * PVA10% ............................ (1)

PV = Present value = ?

ACI = Annual cash inflows = $6,000

PVA = Present value of annuity of $1 at 10% for 4 years = 3.170

Note that the PVA is obtained for year 4 at 10% from the second table as already explained above.

Substituting the values into equation (1), we have:

PV = $6,000 * 3.170

PV = $19,020

Therefore, the correct option is option b. $19,020.

Which of the following recognizes the intellectual property licensing of copyrights by all the signatory nations to the​ act?

a. The Madrid Convention
b. The Export Administration Act of 1985
c. The Berne Convention Implementation Act of 1988
d. The International Emergency Economic Powers Act of 1977

Answers

Answer:

c. The Berne Convention Implementation Act of 1988.

Explanation:

This was put into force in the United States of America in the year 1988 even though its laws were been vehemently upheld from the next year. This was a law put in place to be a guide to a lot of United States citizens who are known to ply their trades in the literary and also artistic sphere. It was seen as a protection agency to writers and artists in literary world. Their work at this early stages may have been performed only pursuant to appropriate domestic law. Also, in a bid to make this law a better one, it was said to be amended together with the law as it exists on the date of the enactment of this law been amended, satisfy the obligations to the citizens of the US.

At the end of a particular operating​ period, suppose Brenda​ (the manager) sits down with Ethan​ (the employee) and they meet to determine how well​ Ethan's performance has met the objectives set by Brenda. Which step in the MBO process would this​ be?

Answers

Answer:

Evaluate performance

Explanation:

The mbo process is a time where an employee and manager work together and sets record for a particular period of time.

This step in the mbo process is evaluation of performance. Under this step, the manager reviews the work of the employee from the question, this is what Brenda is doing with Ethan. She is evaluating his performance.

Vincent operates a scenic tour business in Boston. He has one bus which can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent’s cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay (reservation value): adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent’s demand is:

Answers

Answer:

There is some information missing, and when I looked for it I found similar questions but the demand was already given and the question was about Vincent's total daily income.

Passenger                  Price                  Daily demand

Adults                          $18                        70

Children                      $10                        25

Senior citizens            $12                        55

total                                                           150

total revenue per day = ($18 x 70) + ($10 x 25) + ($12 x 55) = $1,260 + $250 + $660 = $2,170

total operating costs per day = (150 / 50) x $450 = $1,350

operating income per day = $2,170 - $1,350 = $820

Suppose the following items are taken from the 2017 balance sheet of Yahoo! Inc. (All dollars are in millions.)
Goodwill ............................................................. $3,927
Common stock ........................................................ 6,283
Equipment .............................................................. 1,737
Accounts payable ...................................................... 152
Patents ................................................................... 234
Stock investments (long-term) ...................................... 3,247
Accounts receivable .................................................. 1,061
Prepaid rent .............................................................. 233
Debt investments (short-term) ...................................... 1,160
Retained earnings .................................................... 6,108
Cash ................................................................... 2,292
Notes payable (long-term) ............................................ 734
Unearned sales revenue ............................................... 413
Accumulated depreciation-equipment 201
Instructions
Prepare a classified balance sheet for Yahoo! Inc. as of December 31, 2017.

Answers

Answer:

Yahoo! Inc.

Classified balance sheet as of December 31, 2017:

Assets:                                                     ($ million)

Current Assets:

Cash                                           $2,292

Accounts receivable                     1,061

Prepaid rent                                    233

Debt investments (short-term)     1,160

Total Current Assets                               $4,746

Non-current Assets:

Stock investments (long-term)    3,247

Equipment                         1,737

Accumulated depreciation 201    1,536

Patents                                            234

Goodwill                                       3,927

Total non-current assets                        $8,924

Total Assets                                           $13,690

Current Liabilities:

Unearned sales revenue           413

Accounts payable                      152           $565

Non-current Liabilities:

Notes payable (long-term)                          734

Total Liabilities                                       $1,299

Stockholders' Equity:

Common stock                     6,283

Retained earnings                6,108          12,391

Total liabilities + equity                        $13,690

Explanation:

a) This Yahoo!'s 2017 classified balance sheet shows the current assets, current liabilities, non-current assets, non-current liabilities, and the stockholders' equity with their separate totals.  It helps in calculating important financial ratios and in making comparisons in absolute dollar terms from one period to the other or from one company to another entity.

The following standards for variable manufacturing overhead have been established for a company that makes only one product: Standard hours per unit of output 5.2 hours Standard variable overhead rate $11.60 per hour The following data pertain to operations for the last month: Actual hours 2,500 hours Actual total variable manufacturing overhead cost $29,590 Actual output 150 units What is the variable overhead efficiency variance for the month?

Answers

Answer:

Variable overhead efficiency variance= $19,952 unfavorable

Explanation:

Giving the following information:

Standard hours per unit of output 5.2 hours

Standard variable overhead rate $11.60 per hour

Actual hours 2,500 hours

Actual output of 150 units

To calculate the variable overhead efficiency variance, we need to use the following formula:

Variable overhead efficiency variance= (Standard Quantity - Actual Quantity)*Standard rate

Standard quantity= 5.2*150= 780

Variable overhead efficiency variance= (780 - 2,500)*11.6

Variable overhead efficiency variance= $19,952 unfavorable

Sandhill corporation manufactures a single product. montlhly production costs incurred in the manufacturing process are show below for the production of 3900 maintanance costs are mixed costs. the fixed portions of these costs are 387 and 258, respectively.

Production in units 3900
Production cost
Direct materials 9675
Direct labor 27420
Utilities 3702
Property taxes 1290
Indirect labor 5805
Supervisor salaries 2451
Maintanance 1233
Depreciation 3096

Required:
Calculate variable costs per unit, variable cost per unit for utilities and variable cost per unit for maintenance.

Answers

Answer:

variable costs per unit = $10.57

variable cost per unit for utilities = $0.85

variable cost per unit for maintenance = $0.25

Explanation:

I believe that the question is incomplete: the missing part is that both utilities and maintenance costs are mixed.

Production in units 3,900

Variable production cost s:

Direct materials $9,675  / 3,900 = $2.4808 per unit

Direct labor $27,420  / 3,900 = $6.9846 per unit

Utilities ($3,702 - $387) / 3,900 = $0.85 per unit

Maintenance ($1,233 - $258) / 3,900 = $0.25 per unit

total variable costs per unit = $10.5654 ≈ $10.57

Calculating the Direct Labor Rate Variance and the Direct Labor Efficiency Variance
Guillermo's Oil and Lube Company is a service company that offers oil changes and lubrication for automobiles and light trucks. On average, Guillermo has found that a typical oil change takes 18 minutes and 6.2 quarts of oil are used. In June, Guillermo's Oil and Lube had 990 oil changes.
Guillermo's Oil and Lube Company provided the following information for the production of oil changes during the month of June:

Actual number of oil changes performed: 990
Actual number of direct labor hours worked: 291 hours
Actual rate paid per direct labor hour: $16.00
Standard rate per direct labor hour: $15.00

Required:
a. Calculate the direct labor rate variance (LRV) and the direct labor efficiency variance (LEV) for June using the formula approach.
b. Calculate the direct labor rate variance (LRV) and the direct labor efficiency variance (LEV) for June.
c. Calculate the total direct labor variance for oil changes for June.
d. What if the actual wage rate paid in June was $14.00? What impact would that have had on the direct labor rate variance (LRV)? On the direct labor efficiency variance (LEV)? Indicate what the new variances would be below. If required, round your answers to the nearest cent.

Answers

Answer:

Guillermo's Oil and Lube Company

Calculating the Direct Labor Rate Variance and the Direct Labor Efficiency Variance

a1. Direct labor rate variance (LRV) = Actual Labor Rate minus Standard Labor Rate multiplied by Actual hours worked

= $16 - $15 x 291

= $291 U

a2. Direct labor efficiency variance (LEV) = Standard hours minus Actual hours x Standard hourly rate

= 297 - 291 x $15

= $90 F

b1. Direct labor rate variance (LRV) = the difference between the actual wages paid and the standard wages

= (Actual labour rate x actual hours) - (standard rate x actual hours)

= ($16 x 291) - ($15 x 291)

= $4,656 - $4,365

= $291 U

b2. Direct labor efficiency variance = the difference between the actual number of direct labor hours worked and budgeted direct labor hours that should have been worked based on the standards

(291 x $15) - (297 x $15)

4,365 - 4,455

= $90 F

c. Total Direct labor rate variance (LRV) = Actual Wages minus Standard Wages

= (Actual labor rate x Actual hours) - (Standard labor rate x Standard hours)

= ($16 x 291) - ($15 x 297)

= $4,656 - $4,455

= $201 U

d. If actual wage rate paid in June was $14.00:

d1. Direct labor rate variance (LRV) = Actual Labor Rate minus Standard Labor Rate multiplied by Actual hours worked

= $14 - $15 x 291

= $291 F

d2. Direct labor efficiency variance (LEV) = Standard hours minus Actual hours x Standard hourly rate

= 297 - 291 x $15

= $90 F

d3. Total Direct labor rate variance (LRV) = Actual Wages minus Standard Wages

= (Actual labor rate x Actual hours) - (Standard labor rate x Standard hours)

= ($14 x 291) - ($15 x 297)

= $4,074 - $4,455

= $381 F

Explanation:

a) Data and Calculations

Actual number of oil changes performed: 990

Standard number of direct labor hours to for 990 oil changes = 990 x 0.3 hours (since 18 minutes = 0.3 hours or 18/60) = 297 hours

Actual number of direct labor hours worked: 291 hours

Actual rate paid per direct labor hour: $16.00

Standard rate per direct labor hour: $15.00

b) The impact on direct labor rate variance if the actual wage rate paid in June was $14 was to turn the unfavorable labor rate variance into a favorable variance of $291 and the total direct labor variance would have been a favorable variance $381 instead of an unfavorable variance of $201.

Willow Corporation had three employees. Two of the employees worked full-time and earned salaries of $25,000 each. The third employee worked only part-time and earned $3,000. The employer timely paid state unemployment tax equal to 5.4 percent of each employee's wages up to $7,000. How much FUTA tax is due from Willow Corporation for 2019, after the credit for state unemployment taxes?

Answers

Answer:

$102

Explanation:

FUTA tax due from Willow Corporation for 2019, after the credit for state unemployment taxes, can be calculated by deducting the Paid state unemployment tax by the FUTA tax.

DATA

Paid State Unemployment Tax = (7,000+7,000+3,000) x 5.4%

Paid State Unemployment Tax = $918

FUTA tax rate in 2019 = 6%

Solution

FUTA tax (6% x $17,000) = $1,020

FUTA tax due =  $1,020 - $918

FUTA tax due = $102

On December 21, 2017, Novak Company provided you with the following information regarding its equity investments.
December 31, 2017
Investments (Trading)
Cost
Fair Value
Unrealized Gain (Loss)
Clemson Corp. stock $20,200 $19,300 $(900)
Colorado Co. stock 9,900 8,900 (1,000)
Buffaloes Co. stock 20,200 20,790 590
Total of portfolio $50,300 $48,990 (1,310)
Previous fair value adjustment balance 0
Fair value adjustment—Cr. $(1,310)
During 2018, Colorado Company stock was sold for $9,410. The fair value of the stock on December 31, 2018, was Clemson Corp. stock—$19,410; Buffaloes Co. stock—$20,700. None of the equity investments result in significant influence.
(a) Prepare the adjusting journal entry needed on December 31, 2017.
(b) Prepare the journal entry to record the sale of the Colorado Co. stock during 2018.
(c) Prepare the adjusting journal entry needed on December 31, 2018.
(Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
No.
Account Titles and Explanation
Debit
Credit
(a) On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
(b) On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
(c) On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w
On December 21, 2017, Novak Company provided you w

Answers

Answer:

(a)

Dr Unrealized Holding Gain or Loss -Equity $1,410

Cr Fair Value Adjustment $1,410

(b)

Dr Cash $9,410

Dr Loss on Sale of Investment $590

Cr Equity Investment $10,000

(c)

Dr Fair Value Adjustment $1,120

Cr Unrealized Holding Gain or Loss-Equity $1,120

Explanation:

(a) Preparation of the adjusting journal entry needed on December 31, 2017.

Dr Unrealized Holding Gain or Loss -Equity $1,410

Cr Fair Value Adjustment $1,410

(To Adjust to Fair Value for 2017)

(b) Preparation of the journal entry to record the sale of the Colorado Co. stock during 2018.

Dr Cash $9,410

Dr Loss on Sale of Investment $590

(20,200- 20,790)

Cr Equity Investment $10,000

($9,410+$590)

(To Record Sale of Stock)

(c)Preparation of the adjusting journal entry needed on December 31, 2018.

Dr Fair Value Adjustment $1,120

Cr Unrealized Holding Gain or Loss-Equity $1,120

(To Adjust to Fair Value for 2018)

Investments Amortized Costs, Fair Value , Unrealized Gain (Loss)

Clemson Corp. stock

$20,200 $19,410 ($790)

Buffaloes Co. stock

$20,200 $20,700 $500

$40,400 $40,110 ($290)

Previous Fair Value Adjustment (Credit)

$1,410

Fair Value Adjustment (Debit)$1,120

Which of the following is one of the two fundamental issues that the recommendations of the 1947 Hutchins Commission on social responsibility in journalism were based on?a. Society's welfare is paramount. b. Morality should be a business practice. c. Corporate responsibility is essential. d. The golden rule should be written in stone.

Answers

Answer:

a. Society's welfare is paramount.

Explanation:

A commission on the freedom of press also known as "The Hutchins Commission" was formed in the United States of America (USA) during the World War II (WWII) by Robert Maynard Hutchins.

In 1947 after deliberating on the issues of press for four (4) years, the Hutchins Commission concluded that society's welfare is paramount, this is one of the two fundamental issues that the recommendations of the 1947 Hutchins Commission on social responsibility in journalism is based on. The commission stated that the development and stability of a society is influenced by the operations of the press and as such it is very important that the mass media (press) is socially responsible.

Some of the guidelines or recommendations made by the Hutchins Commission for the press are;

1. Present meaningful, reliable and accurate news to the general public; not opinions.

2. Present an overall view of what was known about society.

3. Avail the citizens an opportunity for constructive criticism and exchange of comment about the government.

. How much would you have to deposit today if you wanted to have $66,000 in four years? Annual interest rate is 9%. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your answer to the nearest whole dollar.) b. Assume that you are saving up for a trip around the world when you graduate in two years. If you can earn 8% on your investments, how much would you have to deposit today to have $18,500 when you graduate? (Round your answer to 2 decimal places.) c-1. Calculate the future value of an investment of $787 for ten years earning an interest of 9%. (Round your answer to 2 decimal places.)

Answers

Answer:

a. To have $66,000 in four years with an annual interest rate of 9%, the present value is:

PV = $66,000 x discount factor

= $66,000 x (1.09)^4

= $66,000 x 0.708

= $46,728

b. To have $18,500 in two years with an interest rate of 8% yearly, the present value is:

PV = $18,500 x discount factor

= $18,500 x (1.08)^2

= $18,500 x 0.857

= $15,854.50

c. The future value of an investment of $787 for ten years earning an interest of 9% is:

FV = $787 x FV factor

= $787 x (1.09)^10

= $787 x 2.367

= $1,862.83

Explanation:

The present values for options A and B are calculated by discounting the future values with their discount factors.  The present values show the amounts that need to be invested today at prevailing interest rates to yield the future values after the indicated periods of time.

The future value for option C is calculated by multiplying the present value of the investment with its future value factor.  These present and future values show that there is a time value of money.  This concept means that money received today is not equal in value to the same amount received some time later.  Based on this difference, interest rates are charged to equate the values of money received today and money received in a year's time.  The interest rates also consider the inflation rate and must always be above the inflation rate in order to retain future value.

The risk-free rate is 6% and the expected rate of return on the market portfolio is 13%. a. Calculate the required rate of return on a security with a beta of 1.25.

Answers

Answer:

The required rate of return is r = 0.1475 or 14.75%

Explanation:

The required rate of return is the minimum return that investors demand/expect on a stock based on the systematic risk of the stock as given by the beta. The expected or required rate of return on a stock can be calculated using the CAPM equation.

The equation is,

r = rRF + Beta * (rM - rRF)

Where,

rRF is the risk free raterM is the return on market

r = 0.06 + 1.25 * (0.13 - 0.06)

r = 0.1475 or 14.75%

Jacob Corcoran bought 10,000 shares of Grebe Corporation stock two years ago for $24,000. Last year, Jacob received a nontaxable stock dividend of 2,000 shares in Grebe Corporation. In the current tax year, Jacob sold all of the stock received as a dividend for $18,000.


Required:

a. Complete the letter to Jacob describing the tax consequences of the stock sale.

b. Prepare a memo for the tax research file describing the tax consequences of the stock sale.

c.

Answers

Answer:

Jacob purchased 10000 shares form Grebe corporation two years ago for $24000

last year Jacob received a non taxable stock dividend of 2000 shares from Grebe corporation

In the current year tax year Jacob sold all stock received as dividend that's 2000 shares for $18000

The gain of the sale of 2000 shares can be calculated by subtracting the basis in the shares from the cost price. the cost of shares = ( $24000 / 12000 ) = $2 per share

profit made from the sales of 2000 shares is calculated as follows ; selling price ( $18000 ) - cost price of 2000 shares ( $2 * 2000) , the profit is $14000 and it is in the long term because the original shares bought has been held for at least 1 year

Explanation:

Jacob purchased 10000 shares form Grebe corporation two years ago for $24000

last year Jacob received a non taxable stock dividend of 2000 shares from Grebe corporation

In the current year tax year Jacob sold all stock received as dividend that's 2000 shares for $18000

The gain of the sale of 2000 shares can be calculated by subtracting the basis in the shares from the cost price. the cost of shares = ( $24000 / 12000 ) = $2 per share

profit made from the sales of 2000 shares is calculated as follows ; selling price ( $18000 ) - cost price of 2000 shares ( $2 * 2000) , the profit is $14000 and it is in the long term because the original shares bought has been held for at least 1 year

Rahman stock just paid a dividend of $3.00 per share. Future dividends are expected to grow at a constant rate of 6% per year. What is the value of the stock if the required return is 12%

Answers

Answer:value of stock for the required return of 12 % =  $53

Explanation:

Given

current dividend just paid = $3.00

dividend to grow at constant rate of 6%

required rate of return =12%

to calculate the value of stock for the requitred return of 12 % , we use the dividend growth model which is  

Current price = dividend ( 1 + growth rate )/ (required rate -growth rate )

                        = 3 x (1+6%) / 12-6 = 3 x 1.06 /6% =3.18/0.06=  $53

Therefore  value of stock for the requitred return of 12 % ,=  $53

During the year, Wright Company sells 500 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. Date Transaction
Number of Units Unit Cost Total Cost
Jan. 1 Beginning inventory 60 $66 $3,960
May. 5 Purchase 280 69 19,320
Nov. 3 Purchase 230 74 17,020
570 $40,300
Calculate ending inventory and cost of goods sold for the year, assuming the company uses FIFO.

Answers

Answer:

$5,180 and $35,120

Explanation:

The computation of the cost of goods sold and the ending inventory is shown below:

There are 500 unit sold so according to that the cost of goods sold is

Jan 1        60 units         $66         $3,960

May 5      280 units       $69         $19,320

Nov 3       160 units      $74           $11,840

Cost of goods sold                        $35,120

Now the ending inventory is

Since there is a 70 ending inventory units i.e comes from

= 570 units - 500 units

= 70 units

So this should be at $74

i.e $5,180

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