Ray's Satellite Emporium wishes to determine the best order size for its best-selling satellite dish (model TS111). Ray has estimated the annual demand for this model at 1,500 units. His cost to carry one unit is $80 per year per unit, and he has estimated that each order costs $22 to place.
Using the EOQ model, how many should Ray order each time?

Answers

Answer 1

Answer:

28.72 units

Explanation:

Calculation of how many should Ray order each time using EOQ model

Using this formula

EOQ= √2DS/H

Where,

D=Annual demand 1,500 units

S=Order costs $22

H=Holding Costs $80 per unit

Let plug in the formula

EOQ=√2*1,500*$22/$80

EOQ=√66,000/$80

EOQ=√825

EOQ=28.72 units

Therefore Using the EOQ model, Ray should order 28.72 units each time.


Related Questions

True or False:
Transactions that result in significant investing and financing activities bu that do not involve cash are reported either directly after the statement of cash flows or in a note to the financial statements

Answers

Answer: True

Explanation:

Transactions that do not increase or decrease cash, but that result in significant investing and financing activities, are reported as noncash activities either directly after the cash flow statement or in a note to the financial statements.

It is true that In cash-flow statement, any transaction that do not involve cash are reported directly after the statement or in a note to the financial statements

Non-cash activities includes depreciation amortization, unrealized gain, unrealized loss etc

In accounting, non-cash investing or financing activities are required to be disclosed in the footnotes to the financial statements or within the cash flow statement.

Therefore, It is true that In cash-flow statement, any transaction that do not involve cash are reported directly after the statement or in a note to the financial statements.

Read more about Non-cash activities here

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Martin works as a pizza delivery person.He parks his bike outside Regalia Inc.to deliver an order.Meanwhile,a damaged book rack in Regalia,which is situated on the first floor of the building,falls down through an open window and crashes on his bike.However,no one admits to having seen the rack fall.Can Martin recover against Regalia for negligence?
A) Martin can recover only if he finds a witness who saw the book rack crashing on the bike.
B) Martin can recover if he can prove that book racks do not fall out of windows in the absence of negligence and that Regalia Inc. had exclusive control of the rack prior to the fall.
C) Martin will be unable to recover because parking under an open floor window amounts to contributory negligence and he is therefore liable for the accident too.
D) Martin will be unable to recover because parking under an open window amounts to assumption of risk.

Answers

Answer:

B) Martin can recover if he can prove that book racks do not fall out of windows in the absence of negligence and that Regalia Inc. had exclusive control of the rack prior to the fall.

Explanation:

Negligence is defined as a situation where a person does not take due care and conduct oneself like a reasonable person in a given circumstance.

When a defendant is negligent he will be held responsible for damage that results from his negligence.

In this scenario Martin's parked his bike and makes a delivery, meanwhile a book rack falls on his bike.

Martin's can only recover against Regalia if he proves that he was not negligent in any way, and that Regalia had control of the rack before the fall.

For example if Martins did not park his bike in a designated parking spot, he can be seen to be negligent. In that case he will not be able to recover against Regalia.

Slack Inc. borrowed $400,000 on April 1. The note requires interest at 12% and principal to be paid in one year. How much interest is recognized for the period from April 1 to December 31? a. $0. b. $48,000. c. $32,000. d. $36,000

Answers

Answer:

D.$36,000

Explanation:

Calculation for How much interest is recognized for the period from April 1 to December 31

First step is to find the 12% of the amount that was borrowed which is $400,000

$400,000×12%

=$48,000

Now let calculate for the amount of interest that is recognized from April 1 to December 31

Interest =$48,000×3/12

Interest =$12,000

Hence,

Interest =$48,000-$12,000

Interest=$36,000

Therefore the amount of interest that is recognized from April 1 to December 31 will be $36,000

Wookie Company issues 8%, five-year bonds, on January 1 of this year, with a par value of $108,000 and semiannual interest payments.

Semiannual Period-End Unamortized Premium Carrying Value
(0) January 1, issuance $8,271 $116,271
(1) June 30, first payment 7,444 115,444
(2) December 31, second payment 6,617 114,617
Use the above straight-line bond amortization table and prepare journal entries for the following:

a) The issuance of bonds on January 1.

b) The first interest payment on June 30.

c) The second interest payment on December 31.

Answers

Answer:

See the journal entries and explanation below.

Explanation:

The journal entries will look as follows

a) The issuance of bonds on January 1.

Date         Accounts title                              Debit ($)         Credit ($)  

Jan. 1        Cash                                              111,671

                   Premium on Bonds Payable                                8,271

                   Bonds Payable (w.1)                                        108,000

          (To record issuance of bonds.)                                                  

b) The first interest payment on June 30.

Date         Accounts title                                 Debit ($)         Credit ($)  

Jun. 30    Interest Expense (w.4)                       3,493  

                 Premium on Bonds Payable (w.2)      827

                 Cash (w.3)                                                                 4,320

               (To record first interest payment)                                              

c) The second interest payment on December 31.

Date         Accounts title                                 Debit ($)         Credit ($)  

Dec. 31    Interest Expense (w.4)                       3,493  

                 Premium on Bonds Payable (w.5)      827

                 Cash (w.6)                                                                 4,320

               (To record second interest payment)                                              

Workings:

w.1: Bond payable = Cash - Premium on Bonds Payable = $111,671 - $8,271

w.2: Premium on Bonds Payable = January 1 Unamortized Premium - June 30 Unamortized Premium = $8,271 - $7,444 = $827

w.3: Cash = $108,000 * 8% * (6 / 12) = $4,320

w.4: Interest expense = w.3 - w.2 = $4,320 - $827 = $3.493

w.5: Premium on Bonds Payable = June 30 1 Unamortized Premium - December 31 Unamortized Premium = $7,444 - $6,617 = $827

w.6: Cash = $108,000 * 8% * (6 / 12) = $4,320

w.7: Interest expense = w.6 - w.5 = $4,320 - $827 = $3,493

Indicate the type of Deferred Tax account created by Unearned Revenues and Prepaid Expenses, respectively:

Answers

Answer:

The answer is Deferred tax asset and Deferred tax liability.

Explanation:

Unearned revenue creates deferred tax asset. In here, taxes have been paid because income has been received but have not been recognized on the income statement because according to the revenue recognition, the services for the revenue has not been rendered.

Prepaid expenses give rise to deferred tax liability. In here, taxes have been recognized on income statement but the actual tax has not been paid. Income tax expense on income statement is greater than taxes payable

Jax Recording Studio purchased $8,200 in electronic components from Music World. Jax signed a 90-day, 10% promissory note for $8,200. Music World's journal entry to record the sales transaction is:

Answers

Answer:

World's journal entry to record the sales transaction is:

Note Receivable ; Jax Recording Studio $8,200 (debit)

Sales Revenue $8,200 (credit)

Explanation:

Music World is the seller and must recognize Revenue following the sale.The Revenue is initially recognized at the value of sale of $8,200. Music World must also recognize an Asset on the promissory note signed to the value of $8,200.

An investment adviser places large block trades for securities positions that are being purchased for its customers' accounts in order to lower its commission costs. The trades are often executed piecemeal, at different prices. The adviser, after being confirmed that the entire block has been filled, allocates the shares to its accounts. As a favor to its most valuable employees, the adviser allocates the shares purchased at the lowest prices to its employees' accounts; and then allocates the remaining shares to its customer accounts pro-rata. The adviser has disclosed its allocation method only to its employees. Which statement is TRUE

Answers

Answer: The investment adviser has breached its fiduciary duty because it has not disclosed its method of allocating shares to its customers

Explanation:

The options to the question are:

a. The investment adviser has breached its fiduciary duty to its customers because the block order must be executed at one price, not in pieces at differing prices

b. The investment adviser has breached its fiduciary duty because it has not disclosed its method of allocating shares to its customers

c. The investment adviser has not breached its fiduciary duty because it has disclosed its method of allocating shares to its employees

d. The investment adviser has not breached its fiduciary duty to customers because it has obtained trade executions for customers at lower commission costs.

Based on the scenario in the question, it should be noted that the investment adviser has breached its fiduciary duty because it has not disclosed its method of allocating shares to its customers.

Fiduciary duty is a legal obligation whereby a party has to work in the best interest of the other party and should also be trustworthy but in this situation, this isn't thw case.

Stephen Battista argues that public relations should help Under Armour convince customers that the company has a new kind of sports apparel. One way that public relations differs from other kinds of marketing communications is that it substitutes the term ________ for target market. Multiple Choice target audience consumer referent group public market segment

Answers

Answer:

The correct answer is the option: Public.

Explanation:

To begin with, the term of "Public Relations" refers to the instrument that the marketing managers have in order to establish better relationships with agents that are outside the company with the primary focus of increasing those relations that will eventually increase the company's public image. Moreover, one the variables that changes when the company decides to use this type of strategy is the fact that the target audience or market changes to be the public in general and that is why that the company forgets about their customers and focus on the public as a whole.

A manufacturing company that has only one product has established the following standards for its variable manufacturing overhead. Variable manufacturing overhead standards are based on machine-hours. Standard hours per unit of output 4.50 machine-hours Standard variable overhead rate $11.52 per machine-hour
The following data pertain to operations for the last month:
Actual hours 8,900 machine-hours Actual total variable manufacturing overhead cost $95,920 Actual output 1,800 units
What is the variable overhead rate variance for the month?

Answers

Answer:

Variable manufacturing overhead rate variance= $7,209 favorable

Explanation:

Giving the following information:

Standard variable overhead rate $11.52 per machine-hour

Actual hours 8,900 machine-hours

Actual total variable manufacturing overhead cost $95,920

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

Variable manufacturing overhead rate variance= (standard rate - actual rate)* actual quantity

Standard rate= 95,290/8,900= 10.71

Variable manufacturing overhead rate variance= (11.52 - 10.71)*8,900

Variable manufacturing overhead rate variance= $7,209 favorable

You have a $46,000 portfolio consisting of Intel, GE, and Con Edison. You put $20,800 in Intel, $10,400 in GE, and the rest in Con Edison. Intel, GE, and Con Edison have betas of 1.3, 1, and .8, respectively. What is your portfolio beta? Multiple Choice 1.071 0.976 0.824 1.393

Answers

Answer:  1.071

Explanation:

The portfolio beta is the weighted average of the constituent stock betas.

Intel Weight

= 20,800/46,000

= 0.45217

GE Weight

= 10,400/46,000

= 0.22609

Con Edison

= (46,000 - 20,800 - 10,400) / 46,000

= 0.32174

Portfolio Beta;

= (0.45217 * 1.3) + (0.22609 * 1) + (0.32174 * 0.8)

= 0.587821‬ + 0.22609 + 0.257392‬

= 1.071303‬

= 1.071

Hankins Corporation has 8.1 million shares of common stock outstanding, 300,000 shares of 4.1 percent preferred stock outstanding, par value of $100; and 185,000 bonds with a semiannual coupon rate of 5.5 percent outstanding, par value $2,000 each. The common stock currently sells for $57 per share and has a beta of 1.15, the preferred stock has a par value of $100 and currently sells for $99 per share, and the bonds have 18 years to maturity and sell for 107 percent of par. The market risk premium is 6.6 percent, T-bills are yielding 3.3 percent, and the company’s tax rate is 24 percent.A. What is the firm’s market value capital structure?B. If the company is evaluating a new investment project that has the same risk as the firm’s typical project, what rate should the firm use to discount the project’s cash flows?Solve for:A. DebtPreferred StockEquityB. Discount Rate

Answers

Answer:

common stocks = 8,100,000 x $57 = $461,700,000

preferred stocks = 300,000 x $99 = $29,700,00

debt = 185,000 x $2,000 x 1.07 = $395,900,000

total market value = $887,300,000

a)

capital structure:

common stocks = $461,700,000 / $887,300,000 = 52.03%

preferred stocks = $29,700,00 / $887,300,000 = 3.35%

debt = $395,900,000 / $887,300,000 = 44.62%

b) WACC = 7.48%

Re = 3.3% + (1.15 x 6.6%) = 10.89%

Cost of preferred stock = 4.1 / 99 = 4.14%

cost of debt = YTM = {55 + [(2,000 - 2,140)/36]} / [(2,000 + 2,140)/2] = 51.11 / 2,070 = 2.469 x 2 = 4.94%

WACC = (10.89 x 52.03%) + (4.14 x 3.35%) + (4.94 x 44.62% x 0.76) = 5.67% + 0.14% + 1.67% = 7.48%

A customer redeems 1,000 shares of ABC Fund on Wednesday, June 14th. Under the provisions of the Investment Company Act of 1940, the customer must be paid the money no later than:

Answers

Answer:

Wednesday, June 21st

Explanation:

In this scenario, since the customer redeemed the shares on Wednesday, June 14th then he must be paid before Wednesday, June 21st. This is 7 days after the redemption. According to section 22 article (e) of the Investment Company Act of 1940, all companies are prevented from postponing the date of payment for more than seven days as stated below.

(e) No registered investment company shall suspend the right

of redemption, or postpone the date of payment or satisfaction upon

redemption of any redeemable security in accordance with its terms

for more than seven days after the tender of such security to the

company or its agent designated for that purpose for redemption

Which of the following conditions would necessitate the use of non-verbal communication instead of verbal communication?A) Low physical distanceB) Need for immediate feedbackC) Personal nature of communicationD) Familiarity with the listenerE) Increased noise

Answers

Answer:

E) Increased noise

Explanation:

The answer is that the condition that would necessitate the use of non-verbal communication instead of verbal communication is increased noise because the noise is any type of sound that affects the verbal communication and in a case of increased noise, it could be necessary to use non-verbal communication to be able to deliver a message.

The other options are not right because they don't affect the verbal communication in a way that forces you to use non-verbal communication.

An appraiser estimated the replacement cost new of a building at $560,000. The building has an estimated economic life of 40 years and an estimated remaining life of 30 years. What is the current value of the building

Answers

Answer:

The answer is $420,000

Explanation:

To find the amount of depreciation being charged years, we use the following formula:

Cost of the asset ÷ number of useful life

Cost of the asset - $560,000

Number of useful life - 40 years

$560,000 ÷ 40 years

$14,000.

The asset has 30 years remaining, that means it has used 10 years. So the accumulated depreciation is $140,000

And the current value of the building now is $420,000($560,000 - $140,000)

The current value of the building is $420000

The estimated economic life is 40 years, hence after 40 years the value of the house would be 0.

Since the estimated remaining life is 30 years. Hence:

Percentage value of house = 30 remaining years / 40 economic year

Percentage value of house = 0.75 * 100 = 75%

The current value of the building = 75% * $560000 = $420000

The current value of the building is $420000

Find out more on current value at: https://brainly.com/question/24304697

Orleans Corporation, a U.S. corporation, reported U.S. taxable income of $2,000,000. Included in the computation of taxable income was a $400,000 dividend from a 5%-owned Canadian subsidiary. A withholding tax of $8,000 was imposed on the dividend. What is Orleans’s net U.S. tax liability?

Answers

Answer:

$420,000

Explanation:

Calculation for Orleans’s net U.S. tax liability

Using this formula

Tax liability=Taxable income×U.S tax rate

Let plug in the formula

Tax liability=$2,000,000×21%

Tax liability=$420,000

Therefore Orleans’s net U.S. tax will be $420,000. The withholding tax amount of $8,000 was not included because it was already imposed on the dividend.

​Break-even EBIT​ (with and without ​taxes). Alpha Company is looking at two different capital​ structures, one an​ all-equity firm and the other a levered firm with ​$ million of debt financing at ​% interest. The​ all-equity firm will have a value of ​$ million and shares outstanding. The levered firm will have shares outstanding. a. Find the​ break-even EBIT for Alpha Company using EPS if there are no corporate taxes. b. Find the​ break-even EBIT for Alpha Company using EPS if the corporate tax rate is ​%. c. What do you notice about these two​ break-even EBITs for Alpha​ Company? a. What is the​ break-even EBIT for Alpha Company using EPS if there are no corporate​ taxes?

Answers

Complete Question:

Alpha company is looking at two different capital structures, one an all-equity firm and the other a leverages firm with $2 million of debt financing at 8% interest. The all-equity firm will have a value of $4 million and 400,000 shares outstanding. The leveraged firm will have 200,000 shares outstanding.

a. Find the break even EBIT for Alpha company using EPS if there are no corporate taxes.

b.Find the break even EBIT for Alpha company using EPS if the corporate tax rate is 30%

c. What do you notice about these two break-even EBITs for Alpha company?

Answer:

Alpha Company

a. Break-even EBIT, using EPS without taxes:

= (EBIT - Interest 1) * (1 - taxes)/No. of shares =  (EBIT - Interest 2) * (1 - taxes)/No. of shares

With alternative 1, there are no taxes, so:

= (EBIT - Interest 1)/No. of shares = EBIT - Interest 2)/No. of shares

= (EBIT - 0)/400,000 = EBIT - ($2,000,000 x 8%)/200,000

= (EBIT/400,000( = (EBIT - $160,000)/200,000

cross-multiplying:

EBIT200,000 = EBIT$64,000,000,000

dividing by 200,000:

EBIT = $64,000,000,000/200,000

EBIT = $320,000

b. Break-even EBIT, using EPS with taxes:

= (EBIT - Interest 1) * (1 - taxes)/No. of shares =  (EBIT - Interest 2) * (1 - taxes)/No. of shares

= {(EBIT - $0) * (1 - 0.30)}/400,000 = {(EBIT - $160,000) * (1 - 0.30)}/200,000

= EBIT/400,000 = (EBIT - $112,000)/200,000

cross-multiplying:

= EBIT 200,000 = EBIT $44,800,000,000

EBIT = $44,800,000,000/200,000

= $224,000

c. The two break-even EBITs are not the same.  When there are taxes, the break-even EBIT is $224,000, less by $96,000.

Explanation:

a) Data:

Alternative 1: All Equity:

No. of shares = 400,000

Value of shares = $4,000,000

Debt = $0

Interest on Debt = $0

Alternative 2: Equity + Debt:

No. of shares = 200,000

Value of shares = $2,000,000

Debt = $2,000,000

Interest on Debt = 8% or $160,000

b) Alpha's break-even EBIT is the point when the EBIT under alternative 1 are equal to the EBIT under alternative 2.  This implies that under these given alternative financing options, the earnings before interest and taxes are before no matter the alternative chosen.

The present value of $10,000 to be received in 10 years, discounted at an annual rate of 6.78%, is closest to:

Answers

Answer:

PV= $5,189.21

Explanation:

Giving the following information:

The present value of $10,000 to be received in 10 years, discounted at an annual rate of 6.78%.

To calculate the present value, we need to use the following formula:

PV= FV/(1+i)^n

PV= 10,000/(1.0678^10)

PV= $5,189.21

Quality is primarily related to satisfaction viewpoint of:___________.
a. Customer Manufacturer
b. Service provider
c. General public
d. all of above

Answers

Answer: Consumer

Explanation:

Quality has to do with the standard by which a product is being compared with other similar products.

Quality is primarily related to satisfaction viewpoint of consumers. If consumers are not satisfied with a particular product, it will have a negative impact on the sale of the product hence the product quality must be taken into consideration in order to enable consumers to buy such product.

What is the payback period of a project with average annual cash outflows of $8,000, average annual cash inflows of $10,000 and an initial investment of $13,000

Answers

Answer:

It will take 3 years and 219 days to cover for the initial investment.

Explanation:

Giving the following information:

Annual cash flow= 13,000 - 8,000= $5,000

Initital investment= $13,000

The payback period is the time required to cover for the initial investment:

Year 1= 5,000 - 13,000= -8,000

Year 2= 5,000 - 8,000= -3,000

Year 3= 5,000 - 3,000= 2,000

To be more accurate:

(3,000/5,000)*365= 219 days

It will take 3 years and 219 days to cover for the initial investment.

Part-time workers likely result in A. inaccurately high estimates of the labor force. B. inaccurately low estimates of the labor force. C. a disincentive for the unemployed to seek employment. D. lower incomes and fewer jobs.

Answers

Answer:

Correct answer:

A. inaccurately high estimates of the labor force.

Explanation:

Part-time work is the type of work where an individual has a flexible work plan is a given company unlike the traditional full-time work. Doing such work create the impression that, there is high labour force among the various industries and sectors. For example, someone might be working in two different firms under part-time basis same day which create an impression of two different individuals.

The ____________________ problem is the main source of market failure in the provision of nonexcludable public goods.

Answers

Answer: Free Rider

Explanation:

Non-excludable goods refers to public goods that are free to the public to use such goods and therefore there is no restriction to the  consumption of non-excludable goods because every single individual  has the right to access and consume it  For example,  Public parks, roads, and public infrastructures.

A non excludable good can overtime have a negative result in a community, because such good need to be constantly maintained so as to continue to be beneficial and  therefore may require small token of fair share among its consumers but there would always be some individuals who are referred to as Free Riders  who would rather use the good without paying for it and in the long run cause the good to not be adequate for all or difficult  to be maintained at its best resulting to failure in the provision of the non excludable public goods.

the free rider problem can be solved by

1. Government's intervention to subsidize the public good through fair distribution of tax, using the pay as you earn method .

2. Overused non excludable good can be privatized, ensuring that people who consume it, contribute to ts maintenance.

1.If the manufacturer is considering production quantities of 40,000 units or 80,000 units, assuming 90% of product will be sold and 10% will be salvaged, what is the profit per unit

Answers

Carrier sells air conditioning units to distributors. Ahead of the upcoming summer, demand probability is 40,000 units (25%), 55,000 units (35%), 70,000 units (25%), and 80,000 units (15%).

Fixed cost of production = $500,000

Variable cost of production per unit = $1,200

unit selling price= $1500

value for unsold products = $900

Answer the following questions:

1. If the manufacturer is considering production quantities of 40,000 units or 80,000 units, assuming 90% of product will be sold and 10% will be salvaged, what is the profit per unit?

Answer:

For 40,000 units

Profit per unit = $287.50

For 80,000 units

Profit per unit = $293.75

Explanation:

Total Profit = (0.9 * Total Unit Produced * Per unit selling price) + (0.1 * Total Unit Produced * Per unit selling price) - ( Fixed cost + (Total unit produce* Variable cost per unit))

Total Profit = (0.9 * 40,000 * 1,500 ) + (0.1 * 40,000 * 1,500) - (500,000 + (40,000 * 1,200))

=  54,000,000 + 6,000,000 - 48,500,000 = $11,500,000

For 40,000 units

Total Profit = $11,500,000

Profit per unit = total profit/no. of units

= 11,500,00 / 40,000 =  $287.50

For 80,000 units

Total Profit = (0.9 * 80,000 * 1,500 ) + (0.1 * 80,000 * 1,500) - (500,000 + (80,000 * 1,200))

= 108,000,000 + 12, 000,000 - 96,500,000

= 23,500,000

Total profit = $ 23,500,000

Profit per unit = 23,500,000 / 80,000

=  $293.75

Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $620,000, and the sales mix is 40% bats and 60% gloves. The unit selling price and the unit variable cost for each product are as follows: Products Unit Selling Price Unit Variable Cost Bats $90 $50 Gloves 105 65 a. Compute the break-even sales (units) for the overall enterprise product, E.

Answers

Answer:

$15,500 units

Explanation:

For the computation of break-even sales (units) for the overall enterprise product, E first we need to follow some steps which is shown below:-

Contribution margin = (Selling price - Variable costs)

For Bats $90 - $50

= $40

For Gloves = $105 - $65

= $40

Overall contribution margin = (40 × 40%) + (40 × 60%)

= $40

a.Break-even point = Fixed costs ÷ Contribution margin

= $620,000 ÷ 40

= $15,500 units

An investment adviser representative's friend provides him with a list of 10 prospective clients. The representative agrees to pay his friend a referral fee for each person on the list that opens an account with the adviser. Which statement is TRUE

Answers

Answer: C. The arrangement is permitted only if it is in writing between the investment adviser and the friend and the arrangement is disclosed in writing to any customer opening an account

Explanation:

The friend in this case will be ruled to be a Solicitor under SEC Rules as they are referring clients to the Investment Adviser for a fee.

As such this business relationship between the friend and the Investment Adviser representative will fall under SEC Rule 206(4)-3 Cash payments for client solicitations. This rule makes it clear amongst other things that the investment adviser will have to prepare a written disclosure document which will inform any customer opening an account  of the agreement between the adviser and his friend.

Assume that your parents wanted to have a 170,000 saved for college by your 18th birthday and they started saving on your first birthday. They saved the same amount each year on your birthday and earned 6.5% per year on their investmenets.Required:a. How much would they have to save each year to reach their goal?b. If they think you will take five years instead of four to graduate to graduate and decide to have $140,000 saved just in case, how much more would they have to save each year to reach their new goal?

Answers

Answer:

a. They will have to save $5,245.28 each year to reach their goal of $170,000.

b. They will have to save $925.63 less to reach their new goal of $140,000.

Note: The answer to part b is based on the information in the question. Therefore, the correct answer is "they will have to save $925.63 less" not  "save more" as suggested in the question. Kindly confirm this from your teacher.

Explanation:

a. How much would they have to save each year to reach their goal?

Since the saving started on your first birthday to have $170,000 saved, it implies the saving will be on your every birthday for 18 years. Therefore, the relevant formula to use to determine this is the formula for calculating the Future Value (FV) of an Ordinary Annuity as follows:

FV = M * {[(1 + r)^n - 1] / r} ................................. (1)

Where,

FV = Future value of the amount after your 18th birthday = $170,000

M = Yearly saving to have $170,000 = ?

r = interest rate = 6.5%, 0.065

n = number of years this savings will be made = 18

Substituting the values into equation (1) and solve for M, we have:

$170,000 = M * {[(1 + 0.065)^18 - 1] / 0.065}

$170,000 = M * 32.4100673759666

M = $170,000 / 32.4100673759666

M = $5,245.28

Therefore, they will have to save $5,245.28 each year to reach their goal of $170,000.

b. If they think you will take five years instead of four to graduate to graduate and decide to have $140,000 saved just in case, how much more would they have to save each year to reach their new goal?

First, we have to calculate how much they will save each year, by also using the Future Value (FV) for calculating an Ordinary Annuity as follows:

FVn = Mn * {[(1 + r)^n - 1] / r} ................................. (1)

Where,

FV1 = New future value of the amount after your 18th birthday = $140,000

M1 = New yearly saving to have $140,000 = ?

r = interest rate = 6.5%, 0.065

n = number of years this savings will be made = 18

Substituting the values into equation (1) and solve for M1, we have:

$140,000 = M1 * {[(1 + 0.065)^18 - 1] / 0.065}

$140,000 = M1 * 32.4100673759666

M1 = $140,000 / 32.4100673759666

M1 = $4,319.65

Therefore, they will have to save $4,319.65 each year to reach their goal of $140,000.

To obtain difference in yearly savings, we have:

Difference in yealy saving = M - M1 = $5,245.28 - $4,319.65 = $925.63

Since $5,245.28 each year to reach their goal of $170,000 is greater than $4,319.65 each year to reach their goal of $140,000, it therefore implies that they will have to save $925.63 less to reach their new goal of $140,000.

A company has established 7 pounds of Material J at $2 per pound as the standard for the material in its Product Z. The company has just produced 1,000 units of this product, using 7,200 pounds of Material J that cost $13,080. The direct materials quantity variance is:

Answers

Answer:

-$400 unfavorable

Explanation:

The computation of direct materials quantity variance is shown below:-

Direct material quantity variance = (Standard Quantity × Standard Price) - (Actual quantity × Standard price)

= (1,000 × 7 × $2) - (7,200 × $2)

= $14,000 - $14,400

= -$400 unfavorable

Therefore for computing the direct material quantity variance we simply applied the above formula.

Joy Manufacturing Company needs to know its anticipated cash inflows for the next quarter by month. Cash sales are 25 percent of total sales each month. Historically, sales on account have been collected as follows: 50 percent in the month of the sale, 30 percent in the month after the sale, and the remaining 20 percent two months after the sale.
Gross sales for the quarter are projected as follows:
January $20,000
February $10,000
March $40,000
Accounts receivable on December 31 were $30,000.
Joy's expected cash collections for March would be:________.
A. $37,000
B. $32,000
C. $30,250
D. $47,200

Answers

Answer:

Total cash collection= $30,250

Explanation:

Giving the following information:

Cash sales are 25 percent of total sales each month.

Sales on account:

50 percent in the month of the sale

30 percent in the month after the sale

20 percent two months after the sale.

Sales:

January $20,000

February $10,000

March $40,000

We need to calculate the cash collection for March:

Sales on cash March= 40,000*0.25= 10,000

Sales on account March= (40,000*0.75)*0.5= 15,000

Sales on account February= (10,000*0.75)*0.3= 2,250

Sales on account January= (20,000*0.75)*0.2= 3,000

Total cash collection= $30,250

If Ben invests $3500 at 4% interest per year, how much additional money must he invest at 5 1 2 % annual interest to ensure that the interest he receives each year is 4 1 2 %

Answers

Answer:

Additional $1,750 must be invested by Ben.

Explanation:

Note: The question is not complete as some dots are omitted. The question is therefore given correctly before answering it as follows:

If Ben invests $3500 at 4% interest per year, how much additional money must he invest at 5 1/2 % annual interest to ensure that the interest he receives each year is 4 1/2 %.

The question is now answered as follows:

From the question, we have:

Initial amount invested = $3,500

Interest rate on initial amount invested = 4%, or 0.04

Interest amount from initial amount invested = Initial amount invested * Interest rate on initial amount invested = $3,500 * 4% = $140

Let y represents the additional amount to invest. Therefore, we have:

Interest rate of additional amount invested = 5 1/2% = 5.5% = 0.055

Interest amount from additional amount invested = y * Interest rate of additional amount invested = y * 0.055 = y0.055

Total interest amount = Interest amount from initial amount invested + Interest amount from additional amount invested = $140 + y0.055

New amount invested = Initial amount invested + y = $3,500 + y

Interest rate of new amount invested = 4 1/2% = 4.5% = 0.045

Interest amount from new amount invested = New amount invested * ($3,500 + y) * 0.045 = $157.50 + y0.045

Since total interest amount must equal interest amount from new amount invested, we equate the two and solve as follows:

Total interest amount = Interest amount from new amount invested

$140 + y0.055 = $157.50 + y0.045

We can now solve for y as follows:

y0.055 - y0.045 = $157.50 - $140

y0.01 = $17.50

y = 17.50 / 0.01

y = $1,750

Therefore, additional $1,750 must be invested by Ben.

Vijay Inc. purchased a 3-acre tract of land for a building site for $420,000. On the land was a building with an appraised value of $120,000. The company demolished the old building at a cost of $12,000, but was able to sell scrap from the building for $1,500. The cost of title insurance was $900 and attorney fees for reviewing the contract was $500. Property taxes paid were $3,000, of which $500 covered the period subsequent to the purchase date. The capitalized cost of the land is:

Answers

Answer:

$433,900

Explanation:

The computation of the capitalized cost of the land is shown below:-

Capitalized cost of the land = Purchase price + Demolition of building + Title insurance + Attorney fee + Property taxes covered during the period - Scrap value from the building

= $420,000 + $12,000 + $900 + ($3,000 - $500) - $1,500

= $420,000 + $12,000 + $900 + $2,500 - $1,500

= $435,400 - $1,500

= $433,900

Margin on price as a percentage is the expression of how much you mark your product up by to arrive at your retail price. True False

Answers

Answer:

False

Explanation:

The margin on price refers to a percentage by taking a difference between the gross profit and the selling price

Here gross profit comes by

= Selling price - cost price

Now in the cost price we added some markup percentage i.e most probably equivalent to the retail price

Hence, the given statement is false

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