Answer:
i can't make an answer for you, but i can ask if my rephrasing of the question makes sense.
Explanation:
Cost of Goods sold is 1,113,800 $
An investor sells 100 shares short at $43. The sale requires a margin deposit equal to 60 percent of the proceeds of the sale. The company paid a cash dividend of $1 per share. If the investor closed the position at $38, what was the percentage earned or lost on the investment
Answer:
15.5%
Explanation:
We first calculate the beginning value of the investment
= 43$x100 = 4300
We find ending value = $38x100 = 3800
We find dividend = $1x100 = $100
Profit therefore = 4300-3800-100 = 400
Investment = 60% x 4300= 2580
ROI = 400/2580 = 0.1550 = 15.5%
Therefore calculated percentage = 15.5%
Thank you!
IPS Corp. will upgrade its package-labeling machinery. It costs $850,000 to buy the machinery and have it installed. Operation and maintenance costs, which are $11,000 per year for the first 3 years, increase by $1000 per year for the machine's 10-year life. The machinery has a salvage value of 12% of its initial cost. Interest is 25%. What is the future worth of cost of the machinery
Answer:
The future worth of cost of the machinery is –$8,227,391.25.
Explanation:
The value of an amount of money at a particular interest rate at some point in the future is referred to as future worth.
Note: See the attached excel file for the calculation of the future worth of cost of the machinery.
In the attached excel file, the discounting factor for each year is calculated as follows:
Discounting Factor = (100% + Interest)^Remaining years ………………. (1)
Where:
Interest = 25%
Remaining years = 10 – Number of current year
In the attached excel file, we have:
Total future worth = (8,227,391.25) = –$8,227,391.25
Therefore, the future worth of cost of the machinery is –$8,227,391.25.
Suppose a project financed via an issue of debt requires six annual interest payments of $20 million each year. If the tax rate is 21% and the cost of debt is 6%, what is the value of the interest rate tax shield
Answer:
$4,200,000
Explanation:
Given :
Annual interest payment = $20 million
Tax rate = 21%
Cost of debt = 6%
The value of the interest rate tax shield is given by :
The tax rate * annual interest payment
Tax rate = 21% = 21/100 = 0.21
Annual interest payment = $20,000,000
The value of interest rate tax shield = (0.21 * $20,000,000) = $4,200,000
Your broker suggests that the stock of DUH is a good purchase at $25. You do an analysis of the firm, determining that the recent $1.40 dividend and earnings should continue to grow indefinitely at 5 percent annually. The firm's beta coefficient is 1.3, and the yield on Treasury bills is 1.4 percent. If you expect the market to earn a return of 8 percent, what is your valuation of DUH
Answer:
The correct answer is "$28.03".
Explanation:
The given values are:
Good purchase,
= $25
Dividend,
= $1.40
Annually earning,
= 5%
Beta coefficient,
= 1.3
Treasury bills,
= 1.4%
Now,
= [tex]1.4+1.34\times 8-1.4[/tex]
= [tex]1.34\times 8[/tex]
= [tex]10.244[/tex] (%)
hence,
The fair value will be:
= [tex]1.4\times \frac{1.05}{.10244}-.05[/tex]
= [tex]28.03[/tex]
Absolutely, the proposal including its brokerage must be adopted because as fair market value was almost $25.
In 20X4, Bosh Corporation had income of $60,000 using absorption costing. Beginning and ending inventories were 13,000 and 8,000 units, respectively. The fixed manufacturing overhead cost was $4.00 per unit. What was the net income using direct/variable costing
Answer:
Net income under variable costing $80,000
Explanation:
The computation of the net income using direct/variable costing is shown below:
Net income under absorption costing $60,000
Add fixed cost under applied $20,000
Net income under variable costing $80,000
Working
Beginning inventory 13000
Less ending inventory -8000
Decrease in inventory 5000
Now under applied inventory $20,000
The local gas station agreed to pay its workers $7 an hour in 2018 and $10 an hour in 2019. The CPI was 252 in 2018 and 257 in 2019. Calculate the real wage rate in each year. Did these workers really get a pay raise between 2018 and 2019?
Answer:
Real wage rate can be calculated by:
= Nominal wage rate /CPI * 100
2018 real wage rate:
= 7 / 252 * 100
= $2.78
2019 real wage rate:
= 10 / 257 * 100
= $3.89
Did these workers really get a pay raise between 2018 and 2019?
YES THEY DID:
= 2019 real wage - 2018 wage rate
= 3.89 - 2.78
= $1.11
Monopoly in the competitive environment a. is enjoyed by few organizations as sole suppliers of a good or service. b. is typical of public utilities -- even more so now than twenty years ago. c. cannot be achieved temporarily even through the use of patents and similar legal devices. d. is the logical extension of a firm's control of its production and labor resources. e. is, all in all, the most common type of competition in the U.S. market.
Answer:
b
Explanation:
and services.
An example of a monopoly is a utility company
A natural monopoly occurs due to the high start-up costs or a large economies of scale.
Natural monopolies are usually the only company providing a service in a particular region
Because the demand curve for a monopoly is downward sloping, marginal revenue is less than price. As prices fall, more units of the product are bought.
In a monopoly When the average cost is falling, the marginal cost lies below the average cost. If the government sets price to be equal to marginal cost, which lies below the average cost, the monopoly would incur losses.
Agreements between an exporter and an agent and agreements between an exporter and a distributor are called distribution contracts.
a. True
b. False
Answer: True
Explanation:
The statement that the agreements between an exporter and an agent and the agreements between an exporter and a distributor are called the distribution contracts is true.
It should be noted that the distribution comtract is the contract that takes place between the supplying company and the other company which sells the products. The contract gives the distributor the right to sell and market the product of the supplier.
A company that is at a disadvantage in the marketplace because it lacks competitively valuable resources possessed by rivals:_________
a) nearly always is relegated to a trailing position in the industry.
b) should adopt a new competitive strategy that might better match the circumstances of the marketplace.
c) should abandon strategy elements that have caused its weakness in the marketplace.
Answer:
a) nearly always is relegated to a trailing position in the industry.
Explanation:
Competitive advantage is defined as factors that a business possesses that allows it to produce goods and services that are better or satisfy customers more than those produced by other competitors.
Competitive advantage results in increased sales and higher profit margins.
This can be broken down into:
- Comparative advantage: where a business produces a good more efficiently than its competitors
- Differential advantage: when a good produced is of higher quality or more unique that other competitor products.
When a company lacks competitively valuable resources possessed by rivals, it will nearly always is relegated to a trailing position in the industry. Because they can't meet up to profit margins of others.
The net income reported on the income statement of Cutler Co. was $2,460,000. There were 50,000 shares of $18 par common stock and 20,000 shares of $5 preferred stock outstanding throughout the current year. The income statement included a gain on discontinued operations of $300,000 after applicable income tax.
a. Determine the per-share figure for common stock for income before discontinued operations. Round your answer to the nearest cent.
$ per share
b. Determine the per-share figure for common stock for net income. Round your answer to the nearest cent.
$ per share
Answer and Explanation:
The computation is shown below:
a. The earning per share is
= (PAT - income tax discontinued operations - Preference dividend) ÷ number of common stock
= ($2,460,000 - $300,000 - (20,000 × $5)) ÷ (50,000 shares)
= $41.2 per share
b. The earning per share is
= (PAT - Preference dividend) ÷ number of common stock
= ($2,460,000 - (20,000 × $5)) ÷ (50,000 shares)
= $47.2 per share
For each transaction:
a. analyze the transaction using the accounting equation
b. record the transaction in journal entry form
c. post the entry using T-accounts to represent ledger accounts.
1. On May 15, DeShawn Tyler opens a landscaping company called Elegant Lawns by investing $7,000 in cash along with equipment having a $3,000 value in exchange for common stock.
2. On May 21, Elegant Lawns purchases office supplies on credit for $500.
3. On May 25, Elegant Lawns receives $4,000 cash for performing landscaping services.
4. On May 30, Elegant Lawns receives $1,000 cash in advance of providing landscaping services to a customer.
Answer:
Elegant Lawns
a. Analysis of transactions using the accounting equation:
1. May 15, Assets Cash $7,000 Equipment $3,000 Equity: Common stock $10,000
2. May 21, Assets: Office supplies $500 Liabilities: Accounts Payable $500
3. May 25, Assets: Cash $4,000 Equity: Service Revenue $4,000
4. May 30, Assets: Cash $1,000 Equity: Service Revenue $1,000
b. Journal Entries:
Date Account Titles Debit Credit
1. May 15, Assets: Cash $7,000
Assets: Equipment $3,000
Equity: Common stock $10,000
2.
May 21, Assets: Office supplies $500
Liabilities: Accounts Payable $500
3. May 25, Assets: Cash $4,000
Equity: Service Revenue $4,000
4. May 30, Assets: Cash $1,000
Equity: Service Revenue $1,000
c. T-accounts:
Cash
Date Account Titles Debit Credit
1. May 15 Common stock $7,000
3. May 25, Service revenue 4,000
4. May 30, Service revenue 1,000
Equipment
Date Account Titles Debit Credit
1. May 15 Common stock $3,000
Office Supplies
Date Account Titles Debit Credit
2. May 21, Accounts Payable $500
Common Stock
Date Account Titles Debit Credit
1. May 15 Cash $7,000
1. May 15 Equipment 3,000
Accounts Payable
Date Account Titles Debit Credit
2. May 21, Office supplies $500
Service Revenue
Date Account Titles Debit Credit
3. May 25, Cash $4,000
4. May 30, Cash 1,000
Explanation:
a) Data and Analysis with Accounting Equation:
1. May 15, Assets Cash $7,000 Equipment $3,000 Equity: Common stock $10,000
2. May 21, Assets: Office supplies $500 Liabilities: Accounts Payable $500
3. May 25, Assets: Cash $4,000 Equity: Service Revenue $4,000
4. May 30, Assets: Cash $1,000 Equity: Service Revenue $1,000
You are the owner of a smoothie shop in California. Afterhearing a podcast about customer relationship management (CRM), youdecide to gather more information regarding customer behavior inyour store to better understand the relationships that existbetween your business and your customers. CRM is a comprehensivebusiness model for increasing revenues and profits by focusing oncustomers.Customer Lifetime Value (CLV) is particularly importantwhen it comes to CRM and is often considered one of the mostcrucial metrics associated with a CRM system. Collecting data oncustomers and their relationships with a company (and commonlystoring it within a CRM system) helps make it possible to calculateCLV, or the total amount a customer will spend throughout theirrelationship with a company.
After a review and analysis of your customer data you are ableto determine the following information:
Average Value of Sales per Year per Customer: $120
Average Customer Retention Cost: $75
Customer Acquisition-oriented Marketing Expenses per Month:$1,000
Average Customer Retention Rate: 80%
You acquire an average of 25 new customers a month.
Use the following equations to help determine the CLV:
Average Customer Acquisition Cost = CustomerAcquisition-oriented Marketing Expenses per Month/Number of NewCustomers Acquired per Month
Customer Lifetime Value = [1/(1-Average Customer Retention Rate)] x(Average Value of Sales per Year per Customer)- (Average customerAcquisition Cost + Average Customer Retention Cost)
This activity is important because marketing managers need tounderstand and know how to calculate customer lifetime value as apart of customer relationship management. Knowledge of CLV caninform a number of critical marketing decisions related to suchfactors as the development of strategies designed to aid in theacquisition, nurturing, and retention of customers.
The goal of this exercise is to test your understanding of CLVby considering this example.
You must (1) complete the spreadsheet and (2) answer thequestions that follow to receive full credit for this exercise.
Answer:
Average Customer Retention rate = 80%
Average Value of Sales per year per customer = $120
Average customer acquisition cost = Customer acquisition oriented market expenses per month/
number of new customers acquired per month
[tex]=\frac{1000}{25} = 40[/tex]
Average customer retention cost = $75
CLV =[1/(1- Average customer retention rate)] x (average value of sales per year per customer)-(average customer acquisition cost + average customer retention cost)
[tex]= [1/(1-0.8)] x 120-(40+75)[/tex]
=$485
A) Average customer retention rate =90%
B) Average value of sales per year per customer = $125
C) Average customer acquisition cost =$60
D) Average customer retention cost =$100
CLV = [1/(1- Average customer retention rate)] x (average value of sales per year per customer)-(average customer acquisition cost + average customer retention cost)
[tex]= [1/(1-0.9)] x 125 - (60+100)[/tex]
E) Customer Lifetime Value = 1090
Explanation:
Here are the spreadsheets.
You believe that over the next year the expected return on the market portfolio will yield 11.27%. What is the market risk premium?
Answer: 9.27%
Explanation:
The first part of the question puts the One-year Treasury bill rate at 2%.
The market risk premium is return that the market is offering over what the risk free rate is.
It is therefore calculated by subtracting the risk free rate from the Expected market return which is:
= Expected return on market - Risk free rate
= 11.27% - 2%
= 9.27%
Accompanying a bank statement for Marsh Land Properties is a credit memo for payment on a $15,000 1-year note receivable and $900 of interest collected by the bank. Marsh Land Properties has been notified by the bank at the time of collection, but had made no entries.
Required:
Journalize the entry that should be made by Marsh Land to bring the accounting records up to date.
Answer:
Dr Cash $15,900
Cr Notes Receivable $15,000
Cr Interest Revenue $900
Explanation:
Preparation of the journal entry that should be made by Marsh Land to bring the accounting records up to date.
Dr Cash $15,900
($15,000+$900)
Cr Notes Receivable $15,000
Cr Interest Revenue $900
Which of the following items is a major principle pertaining to selection under the Americans with Disabilities Act?
A) It is unlawful to use criteria that will screen out individuals with disabilities unless the criteria are consistent with a business necessity.
B) It is unlawful to screen out individuals with disabilities for any reason.
C) It is always unlawful for employers to require employees to physical agility tests in a selection context.
D) The employer can retain the right to refuse to hire individuals with disabilities if customers have a strong preference for not encountering disabled staff.
Answer:
A) It is unlawful to use criteria that will screen out individuals with disabilities unless the criteria are consistent with a business necessity.
Explanation:
The Americans with Disabilities Act became a law in the year 1990 in the United States of America. It is a [tex]$\text{civil rights law}$[/tex] which prohibits and prevents any discrimination against a person with disability in any sphere, i.e. in school educations, employment and all the places that are opened for the general public.
It states that it is illegal to use the criteria which will screen out the individuals with any disabilities except the criteria are consistent with business necessity.
A state is conducting an examination of mortgage loan originator Basil Thyme. During the examination, the agency is authorized to do all of the following, except:a. Administer oaths or affirmationsb. Control access to Basil’s officec. Subpoena witnessesd. Require production of relevant documents
Answer: B. Control access to Basil’s office.
Explanation:
During the conduct of the examination of mortgage loan originator Basil Thyme, the agency is authorized to administer oaths or affirmations, subpoena witnesses and require production of relevant documents.
The agency cannot control the access to Basil's office. It can only control access to any records or documents of an individual whim is under investigation.
AG Inc. made a $25,000 sale on account with the following terms: 1/15, n/30. If the company uses the gross method to record sales made on credit, what is the journal entry to record the sale
Answer:
Debit : Accounts Receivable $25,000
Credit : Sales Revenue $25,000
Explanation:
The journal entry to record the sale would include a Debit to Asset Account - Accounts Receivable and Credit to Sales Revenue at the amount of sale including the cash discount.
On the income statement of a merchandising company, interest income and interest expense are reported: Select one: A. As part of cost of goods sold B. By offsetting interest income and interest expense and showing the excess as an operating revenue or expense C. By showing interest income as additional sales revenue and interest expense as an operating expense D. As separate items of other income and expense below the net operating income or loss
Answer:
On the income statement of a merchandising company, interest income and interest expense are reported:
D. As separate items of other income and expense below the net operating income or loss.
Explanation:
Interest income and expense are financing activities items. They do not form part of the operating income or loss. This is why they are shown separately after the determination of the net operating income or loss but before the deduction of income taxes. The reason for this separation is that for a merchandising company, its operating income or loss does not include earned interest income or interest expense but costs related to the merchandise sold, including selling and administrative expenses.
Glaston Company manufactures a single product using a JIT inventory system. The production budget indicates that the number of units expected to be produced are 186,000 in October, 194,500 in November, and 191,000 in December. Glaston assigns variable overhead at a rate of $0.70 per unit of production. Fixed overhead equals $143,000 per month. Compute the total budgeted overhead for October.
Answer:
Budgeted overhead (October)= $273,200
Explanation:
Giving the following information:
Production= 186,000 in October
Predetermined variable overhead= $0.70 per unit.
Fixed overhead equals $143,000 per month.
To calculate the budgeted overhead for October, we need to use the following formula:
Budgeted overhead (October)= 0.7*186,000 + 143,000
Budgeted overhead (October)= $273,200
Kawamura, a careful utility maximizer, consumes peanut butter and ice cream. Assume that both peanut butter and ice cream are normal goods and that diminishing marginal utility applies to both goods. Right after he achieves the utility-maximizing level of consumption of the two goods, the price of peanut butter falls. After he adjusts to this event, the marginal utility of peanut butter goes _____ and that of ice cream goes _____.
Answer:
The marginal utility of peanut butter goes down and that of ice cream goes up.
Explanation:
The substitution effect states that when the price of a product falls, it will lead to a rise in the quantity demanded of the product as buyers will buy more of the product that is now relatively cheaper.
And as more of a good is bought, its marginal utility falls. And as less of a product is bought, its marginal utility increases.
Based on the above explanation therefore, the marginal utility of peanut butter goes down and that of ice cream goes up after Kawamura adjusts to the event.
This is because as more of peanut butter is bought due to the fall in its price, its marginal utility falls. And as less of ice cream is bought as it is now relatively more expensive, its marginal utility increases.
Which economic concept helps explain the changing demand for jewelry?
A. fungibility
b. non-excludability
c. substitution
d. elasticity
Answer:
A.fungibility is a economic concept which helps explain the changing demand for jewelry.
As
Fungibility is the ability of a good or asset to be interchanged with other individual goods or assets .
Midyear on July 31st, the Digby Corporation's balance sheet reported: Total Liabilities of $102.335 million Cash of $8.040 million Total Assets of $165.097 million Retained Earnings of $35.132 million. What was the Digby Corporation's common stock
Answer:
$27.63 million
Explanation:
Total equity = Common stock + Retained earnings
Common stock = Total equity - Retained earnings
Common stock = (Total assets - Total liabilities) - Retained earnings
Common stock = ($165.097 million - $102.335 million) - $35.132 million
Common stock = $62.762 million - $35.132 million
Common stock = $27.63 million
The price of a basket of goods is $2000 in the U.S. If purchasing power parity holds, and the dollar buys two units of some country’s currency, then how many units of foreign currency does the same basket of goods cost in that country?
Answer:
4000
Explanation:
Calculation to determine how many units of foreign currency does the same basket of goods cost in that country
Based on the information given we were told that the PRICE OF A BASKET OF GOODS is the amount of $2000 in which the dollar buys TWO UNITS of some country’s currency, now let determine HOW MANY UNITS of foreign currency does the same basket of goods cost in that country
Using this formula
Units of foreign currency=Basket of goods price*Some country’s currency units
Let plug in the formula
Units of foreign currency=$2,000* 2 units
Units of foreign currency=4,000 units
Therefore the number of units of foreign currency that the same basket of goods cost in that country is 4,000
The price of a basket of goods is $2000 in the U.S. If purchasing power parity holds, and the dollar buys two units of some country’s currency, then how many units of foreign currency does
g Financial information is presented below: Operating Expenses $ 90,000 Sales Returns and Allowances 26,000 Sales Discounts 12,000 Sales 300,000 Cost of Goods Sold 158,000 Gross profit would be
Answer:
$104,000
Explanation:
Calculation to determine what Gross profit would be
Using this formula
Gross profit=Sales -Cost of Goods Sold -Sales Returns and Allowances-Sales Discounts
Let plug in the formula
Gross profit=$300,000-$158,000-$26,000- $12,000
Gross profit=$104,000
Therefore Gross profit would be $104,000
A manufacturer produces two types of computer software, Word processing (W) and Spreadsheet (S), which is offered to two different retail outlets (#1 and #2). The following table shows the maximum price each retail outlet is willing to pay for each individual software product.
Product W Product S
Retail #1 $170 $105
Retail #2 $95 $135
What is the optimal pricing strategy that will maximize revenue for the manufacturer, given the maximum the retail outlets are willing to pay?
a. Bundle both products (W and S) and sell them at $275.
b. Price product W at $95 and Product S at $105.
c. Price product W at $170 and Product S at $170.
d. Price product W at $170 and Product S at $135.
e. Bundle both products (W and S) and sell them at $230.
Answer:
e. Bundle both products (W and S) and sell them at $230.
Explanation:
Calculation to determine the optimal pricing strategy that will maximize revenue for the manufacturer
Using this formula
Optimal pricing=Retail #2 Product W+ Retail #2 Product S
Let plug in the formula
Optimal pricing=$95+$135
Optimal pricing=$230
Therefore based on the above calculation the OPTIMAL PRICING STRATEGY that will MAXIMIZE REVENUE for the manufacturer, given the MAXIMUM the retail outlets are willing to pay will be to BUNDLE BOTH PRODUCTS (W and S) AND SELL THEM AT $230.
ABC Company operates two divisions with the following operating information for the month of May:
Division 1: sales, $128,000; operating income, $39,680; operating assets, $320,000.
Division 2: sales, $84,000; operating income, $42,336; operating assets, $420,000.
ABC Company expects a minimum return of 10% should be earned from all investments.
Required:
Prepare ABC Company’s ROI analysis using the DuPont model for each division.
Suppose that the turkey industry is in long-run equilibrium at a price of $5 per pound of turkey and a quantity of 400 million pounds per year. Suppose that WebMD claims that a protein found in turkey will increase your expected lifespan by 2 years. WebMD's claim will cause consumers to demand _____________turkey at every price.
Answer:
The "WebMD's claim will cause consumers to demand ______more_______turkey at every price."
Explanation:
Consumers will tend to demand more turkey in order to increase their expected lifespan by 2 years by consuming more of the protein found in turkey as claimed by WebMD. This implies that there will a new equilibrium as the old equilibrium shifts outward to match the increased demand by consumers of turkey. This claim may trigger demand and supply to exceed the annual 400 million pounds equilibrium at $5 per pound.
Using a value at risk (VaR) model based on historical data to forecast future expected losses works well:_______
a. all the time.
b. during times of normal market conditions.
c. during times of increased market volatility.
Answer:
b. during times of normal market conditions.
Explanation:
Using a value at risk (VaR) model based on historical data to forecast future expected losses works well: "during times of normal market conditions."
The above statement is true because VaR regardless of the models does not measure the drastic or uncertain situation. Also given that it is used based on historical data, then it is believed to work better on the assumption of normal circumstances.
Mendez Company is considering a capital project that costs $16,000. The project will deliver the following cash flows: Year 1 Year 2 Year 3 Year 4 Year 5 $8,000 $6,000 $5,000 $6,000 $5,000 Using the incremental approach, the payback period for the investment is:
Answer:
2.4 years
Explanation:
Years Cash Cumulative Cashflow
1 8000 8000
2 6000 14000
3 5000 19000
4 4000 25000
5 5000 30000
30000
Payback period = 2 years + (16,000 - 14,000) / 5,000
Payback period = 2 years + 0.4 years
Payback period = 2.4 years
_ refers to exploiting price differences on identical or similar goods, services, assets or factors in different markets. Group of answer choices Externalization Internalization Rationalization Arbitrage Speculation
Answer:
Arbitrage
Explanation:
Arbitrage refers to exploiting price differences on identical or similar goods, services, assets or factors in different markets.
This ultimately implies that, arbitrage allows an individual to profit from the price difference between similar goods, commodity, securities or currency in different markets.
Basically, an individual might decide to almost simultaneously purchase a financial instrument such as a commodity, securities or currency and sell it in a different form or market.
For example, if a stock is trading at £80 on the London Stock Exchange (LSE) while it is trading for £81 on the Nigeria Stock Exchange (NSE) at the same time. John buy the stock on the LSE and sells the same shares immediately on the NSE and earns a profit of £1 per share. Thus, this is simply an arbitrage.
In conclusion, an arbitrage is a type of trade that is caused as a result of market inefficiency.
