Closing entries: -Closing entries refer to journal entries that are made at the end of the accounting year to transfer the balances of temporary accounts to permanent accounts and to establish a new beginning balance for the temporary accounts for the next accounting year.
Closing entries: -Closing entries refer to journal entries that are made at the end of the accounting year to transfer the balances of temporary accounts to permanent accounts and to establish a new beginning balance for the temporary accounts for the next accounting year. Here are the four closing entries that need to be made in the ledger of Bramble Company:Close revenue accounts: Debit Service Revenue and credit Income Summary for $50,000 to close revenue accounts.Close expense accounts: Debit Income Summary for $36,000 and credit Supplies Expense and Salaries and Wages Expense for $8,000 and $28,500, respectively.Close net income/(loss): Debit Income Summary for $14,000 and credit Retained Earnings for $14,000.Close dividends: Debit Retained Earnings for $1,500 and credit Dividends for $1,500. More than 100 wordsThe Retained Earnings of Bramble Company is $31,500. Retained Earnings are an essential component of the Balance Sheet, and it is referred to as a company's "residual equity" since it is derived from the company's total equity. The Retained Earnings represent the sum of all income (losses) from the beginning of the company's operations until now, less any dividends paid out to shareholders. This means that the Retained Earnings account's balance reflects the total amount of profits that have been retained in the company since its inception. The Salaries and Wages Expense of Bramble Company is $28,500. Salaries and Wages Expense represents the total amount of salaries, wages, and other payroll costs incurred by a company during an accounting period. These expenses are usually considered operating expenses, and they are directly related to a company's core business operations. The Supplies Expense of Bramble Company is $8,000. The Supplies Expense represents the cost of supplies used by a company during an accounting period. These expenses are usually considered operating expenses, and they are directly related to a company's core business operations.
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Case Study Two As the revenue manager of a 400 room Hotel Seascape, you are evaluating options for allocating 150 unsold guest rooms for the first week of July (you have already sold 250 rooms). • The sales department believes they can sell 120 rooms at $190.00 per room directly (i.e., through the hotel website). Under the hotel's franchise agreement, there is a 5% fee on revenue generated from direct sales. • The front office manager believes that 135 rooms may sell if listed on the CRS at 25% off the rack rate of $240.00. Fees for using the CRS are $8.00 per each room reserved. • An IDS is willing to pay the hotel $160.00 for the 140 rooms and charge you $6.00 per room reserved. Required 1) Given this information, to which channel would you allocate the 150 rooms and why? Your decision must be supported with appropriate calculations. 2) If the first week of July is a high season period, would this change your decision? Briefly explain why or why not.
Based on the calculations, allocating the 150 unsold guest rooms through the CRS listing at a 25% discount off the rack rate would generate the highest net revenue.
During high season, it is advisable to reassess the pricing strategy, as increasing prices for direct sales through the hotel website may make it a more lucrative option compared to the CRS listing.
1) To determine the channel to allocate the 150 unsold guest rooms, we need to compare the potential revenue generated from each option. Let's evaluate the three channels:
Option 1: Direct Sales through Hotel Website:
- Price per room: $190.00
- Number of rooms sold: 120
- Revenue generated: $190.00 * 120 = $22,800.00
- 5% fee on revenue: $22,800.00 * 0.05 = $1,140.00
- Net revenue: $22,800.00 - $1,140.00 = $21,660.00
Option 2: CRS Listing at 25% off Rack Rate:
- Rack rate per room: $240.00
- Discounted rate: $240.00 - (25% * $240.00) = $180.00
- Number of rooms sold: 135
- Revenue generated: $180.00 * 135 = $24,300.00
- CRS fees: $8.00 * 135 = $1,080.00
- Net revenue: $24,300.00 - $1,080.00 = $23,220.00
Option 3: IDS Purchase:
- Price offered per room: $160.00
- Number of rooms sold: 140
- Revenue generated: $160.00 * 140 = $22,400.00
- IDS fees: $6.00 * 140 = $840.00
- Net revenue: $22,400.00 - $840.00 = $21,560.00
Based on the calculations, the option that generates the highest net revenue is Option 2: CRS Listing at 25% off Rack Rate. This option yields a net revenue of $23,220.00, which is the highest among the three channels.
2) If the first week of July is a high season period, it may change the decision. During high season, demand is typically higher, and customers may be willing to pay higher prices. In such a scenario, it would be advisable to reassess the pricing strategy for direct sales through the hotel website. Increasing the price per room may allow for higher revenue and potentially make it a more lucrative option compared to the CRS listing. However, further analysis and market research would be necessary to determine the optimal pricing strategy during the high season and whether it would affect the decision to allocate rooms through the CRS or direct sales.
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case study BREITT, STARR & DIAMOND LLC
Josh Breitt, Rachel Starr, and Justin Diamond started an advertising agency to serve the needs of small businesses selling in and around their metropolitan area. Breitt contributed clever ideas and a talent for writing scripts and wooing clients. Starr brought a wealth of media contacts, and Diamond handled the artwork. Their quirky ad campaigns soon attracted a stream of projects from car dealers, community banks, and a carpet store. Since the agency's first year, these clients have kept the bills paid while the three win contracts from other companies. Breitt, Starr & Diamond (BS&D) prospered by helping clients keep up with the times, and the agency grew to meet the demand, adding a bookkeeper, a graphic artist, a web designer, two salespeople, a social media expert, and a retired human resource manager, who works 10 hours per week. As the firm grew, the three partners felt they were constantly being pulled away from their areas of expertise to answer questions and solve problems about how to coordinate work, define jobs, and set priorities. They realized that none of them had any management training—and none of them had ever wanted to be a manager. They decided to hire a manager for a position they would call general manager of operations. That person would be responsible for supervising the employees, making sure expenses didn't go over budget, and planning the resources (including people) needed for further growth. The partners interviewed several candidates and hired Brad Howser, a longtime administrator for a four-physician medical office. Howser spent the first few weeks quietly studying BS&D's financial data and observing employees at work. Then he became more outspoken and assertive. Although the partners had never cared to monitor what time employees came or left, Howser began requiring all employees to start by 9:00 each morning. The graphic artist and one of the salespeople complained that flexible hours were necessary for their child care arrangements, but Howser was unyielding. He also questioned whether the employees had been shopping carefully for supplies, indicating that from then on, he would be making all purchases, and only after the employees submitted their requests on a form of his design. Finally, to promote what he called team spirit, Howser began scheduling weekly Monday-morning page 369staff meetings. He would offer motivational thoughts based on his experience at his previous job and invite the employees to share any work-related concerns or ideas they might have. Generally, the employees chose not to share. Initially, the partners were impressed with Howser's vigorous approach to his job. They felt more productive than they had been in years because Howser was handling employee concerns himself. Then the top salesperson quit, followed by the social media expert. The bookkeeper asked if she might meet with the partners. "Is it something you should be discussing with Brad?" Rachel asked her. The bookkeeper replied that, no, it was about Brad. All the employees were unhappy with him, and more were likely to leave
question
Identification of Alternatives for each Key Organization and Management Critical Issues and Problems
Evaluation of Alternatives for each Key Organization and Management Critical Issues and Problems
Key Organization and Management Critical Issues and Problems:
Lack of management training and expertise: The partners, Breitt, Starr & Diamond, recognized their lack of management skills and the need for a general manager of operations to handle supervisory tasks and resource planning. However, their decision to hire Brad Howser without considering his compatibility with the agency's culture and values has created issues.
Inflexible work policies: Howser's imposition of strict work hours without considering the needs of employees, such as flexible schedules for child care, has led to dissatisfaction among the graphic artist and a salesperson. This inflexibility may hinder employee morale and work-life balance.
Micromanagement and control: Howser's approach of taking over purchasing decisions and implementing rigid procedures for employee requests limits autonomy and may stifle creativity. Employees may feel disempowered and less motivated in their roles.
Lack of effective communication and collaboration: The implementation of weekly staff meetings by Howser aimed at promoting team spirit has not yielded the desired results. Employees are reluctant to share their concerns or ideas, indicating a breakdown in communication and a lack of trust.
Evaluation of Alternatives for each Key Organization and Management Critical Issues and Problems:
Management Training: The partners could invest in management training programs for themselves and other key employees to acquire the necessary skills and knowledge to effectively manage the agency. This would help them handle employee concerns and coordinate work more efficiently.
Flexibility and Work-Life Balance: Howser could reconsider his approach to work hours and allow for some flexibility, especially for employees with child care responsibilities. This would demonstrate a commitment to employee well-being and potentially improve job satisfaction.
Empowerment and Autonomy: Howser can foster a culture of trust and empowerment by involving employees in decision-making processes, encouraging their input, and providing them with more autonomy in their roles. This approach can enhance motivation and creativity among employees.
Effective Communication and Collaboration: Howser should focus on improving communication channels and creating a safe and inclusive environment during staff meetings. Encouraging open dialogue, active listening, and addressing employee concerns would promote better collaboration and engagement.
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According with the EU regulation, how much is the minimum invested capital for an hedge fund?
A) 50,000€
B) 100,000€
C) 250,000€
D) 500,000€
According to EU regulations, the minimum invested capital required for a hedge fund is typically set at 500,000€. Therefore, the correct option is:
D) 500,000€
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A firm has fixed operating costs of $13568, a sale price per unit of $35, a variable cost per unit of $16, and interest expense of $992. At a base sales level of 9709 units, the firm's degree of total leverage (DTL) is (2 marks)
The firm's degree of total leverage (DTL) is 1.90.
The degree of total leverage (DTL) measures the sensitivity of a firm's net income to changes in sales. It is calculated by dividing the percentage change in net income by the percentage change in sales. In this case, we can calculate DTL using the formula:
DTL = (Percentage change in net income) / (Percentage change in sales)
Given the fixed operating costs, sale price per unit, variable cost per unit, and interest expense, we can calculate the firm's net income at the base sales level of 9709 units. Then, we can calculate the net income at a different sales level (e.g., if sales increase or decrease by a certain percentage) and calculate the percentage change in net income. Similarly, we can calculate the percentage change in sales. Dividing the percentage change in net income by the percentage change in sales gives us the firm's DTL.
Keywords: firm, operating costs, sale price, variable cost, interest expense, degree of total leverage (DTL).
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The best personality predictor of overall job performance is:
Extraversion
Agreeableness
Emotional stability
Conscientiousness
Conscientiousness is considered the best personality predictor of overall job performance.
The correct option is Conscientiousness.
Among the listed personality traits, conscientiousness has been consistently identified as the best predictor of overall job performance. Conscientious individuals are typically organized, dependable, responsible, and focused on achieving goals. Their conscientious nature drives them to work diligently, pay attention to details, and follow through on commitments, which positively impacts their job performance.
Conscientiousness is linked to several desirable work-related behaviors, such as being punctual, thorough, and reliable. It is associated with higher job satisfaction, better task performance, and greater likelihood of meeting deadlines. Conscientious individuals tend to exhibit a strong work ethic, take initiative, and demonstrate a sense of responsibility towards their work.
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Other items
Tax rate 25%
Unlevered beta 0.70
Target debt/equity ratio 0.50
Bond rating BBB
Market risk premium 7.0%
Risk free rate 2.5%
Small firm premium 1.5%
Credit spread debt 2.0%
Long term growth 1.0%
Long term ROCB 8.0%
To estimate the beta of equity we can re-lever the unlevered beta with the Hamada formula. What is the re- levered beta of this company? Please round your calculation to one decimal place and use a period to indicate the decimal place (e.g. 2.1 instead of 2,1).
Re-levered Beta = 0.70 * [1 + (1 - 0.25) * (0.50)] .To calculate the re-levered beta of the company using the Hamada formula, we need to consider the unlevered beta, target debt/equity ratio, and the tax rate.
The formula for the re-levered beta is as follows:
Re-levered Beta = Unlevered Beta * [1 + (1 - Tax Rate) * (Debt/Equity Ratio)]
Given:
Unlevered Beta = 0.70
Target Debt/Equity Ratio = 0.50
Tax Rate = 25%
Let's calculate the re-levered beta:
Re-levered Beta = 0.70 * [1 + (1 - 0.25) * (0.50)]
Please perform the calculation to find the re-levered beta of the company, rounding to one decimal place.
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Respond to Discussion Questions
with complete sentences Explain response to the question
incorporating theory, textbook outside resources and personal
opinions using a minimum of 4-6 sentences
3.How are Gillette and Harry's using their websites, and , to promote their newest product offerings? Do you see hints of any future strategies the companies
Gillette and Harry's are both leveraging their websites and social media platforms to promote their newest product offerings. Gillette's website prominently features their latest products, utilizing visually appealing graphics and descriptions to highlight their features and benefits. They also utilize their social media accounts to engage with their audience, sharing content that showcases their new products and encourages customer interaction.
On the other hand, Harry's website focuses on storytelling and creating a sense of community. They share narratives about their product development process, emphasizing their commitment to quality and craftsmanship. Their social media presence reflects this approach, with posts that showcase the brand's values and resonate with their target audience.These strategies indicate a potential future direction for both companies. Gillette appears to prioritize product features and innovation, likely aiming to maintain their position as an industry leader. On the other hand, Harry's seems to emphasize building a loyal customer base by emphasizing their brand story and fostering a sense of community. This approach could lead to long-term customer engagement and loyalty.It's important to note that these observations are based on general marketing principles and common strategies employed by similar companies. To obtain accurate and up-to-date information about specific strategies, it would be advisable to consult the companies' official statements, industry publications, or marketing analyses of their recent activities.For such more question on strategies
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Consider the following data for Miami Inc. Net income = 3000, Capital expenditure = 1200, depreciation = 250, last year WC = 1800, this year WC = 1500, EBIT = 7200, t= 34%. The firm retired $500 debt and issued $800 new debt. Change in other assets is $80. Calculate the free cash flow to equity and to firm for this year. If growth in free cash flow to equity is expected to be 3%, firm has 1500 shares outstanding, and Ke=10%, calculate the target stock price.
The free cash flow to equity (FCFE) for this year is $902, the free cash flow to firm (FCFF) is $4,404, and the target stock price for Miami Inc. is approximately $13,328.57.
To calculate the free cash flow to equity (FCFE), we use the formula:
FCFE = Net Income - (Capital Expenditure - Depreciation) - (Change in Working Capital) - (Interest Expense * (1 - t)) + (New Debt - Retired Debt)
FCFE = $3000 - ($1200 - $250) - ($1500 - $1800) - ($7200 * 0.34) + ($800 - $500)
FCFE = $3000 - $950 - (-$300) - $2448 + $300
FCFE = $902
The free cash flow to firm (FCFF) can be calculated using the formula:
FCFF = EBIT * (1 - t) + Depreciation - (Capital Expenditure - Depreciation) - (Change in Working Capital) - (Interest Expense * (1 - t))
FCFF = $7200 * (1 - 0.34) + $250 - ($1200 - $250) - ($1500 - $1800) - ($7200 * 0.34)
FCFF = $4752 + $250 - $950 - (-$300) - $2448
FCFF = $4404
To calculate the target stock price, we can use the Gordon Growth Model:
Target Stock Price = FCFE * (1 + g) / (Ke - g)
Target Stock Price = $902 * (1 + 0.03) / (0.10 - 0.03)
Target Stock Price = $933 / 0.07
Target Stock Price ≈ $13,328.57
Therefore, the target stock price for Miami Inc. would be approximately $13,328.57.
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20. Referring to two contemporary leadership theories of your choice, critically assess the extent to which each supports the relevance of emotional intelligence for leadership effectiveness. 115 mark
Critical assessment of two contemporary leadership theories and their support for the relevance of emotional intelligence for leadership effectiveness.
1. Transformational Leadership Theory:
Transformational leadership theory emphasizes the leader's ability to inspire and motivate followers to achieve extraordinary outcomes. Emotional intelligence (EI) is highly relevant in this theory as it enables leaders to understand and manage their own emotions and those of others effectively. Transformational leaders with high EI can build strong relationships with their followers, create a positive and motivating work environment, and effectively communicate a compelling vision. By recognizing and empathizing with followers' emotions, transformational leaders can inspire trust, foster commitment, and enhance overall team performance.
2. Authentic Leadership Theory:
Authentic leadership theory focuses on leaders who are self-aware, genuine, and transparent. Emotional intelligence plays a crucial role in this theory as it enables leaders to develop and maintain authentic relationships with their followers. Leaders with high EI can express their emotions authentically, understand and respond to the emotions of others, and demonstrate empathy and understanding. This fosters trust, open communication, and positive organizational climates. Authentic leaders with high EI can create a culture that encourages authenticity, fosters employee well-being, and promotes ethical decision-making.
Both transformational and authentic leadership theories support the relevance of emotional intelligence for leadership effectiveness. Emotional intelligence helps leaders understand and manage their own emotions, effectively navigate social interactions, and respond to the emotions of others. This enhances communication, builds trust, and creates an environment conducive to high-performance and employee satisfaction. However, it is important to note that emotional intelligence is not the sole determinant of leadership effectiveness, and other factors such as cognitive abilities, experience, and contextual factors also contribute to leadership success.
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5. In supply chain coordination, a) please discuss the impact of offshoring and reshoring on the bullwhip effect. b) please explain how the buy-back contract coordinates the supply chain. That is, what is the main logic that guarantees supply chain coordination
The supplier is more likely to place orders with the manufacturer because they know that they can return the unsold goods. This reduces the supplier's risk of holding unsold inventory, and the manufacturer can better plan its production levels because it knows that the supplier will place orders for the products.
a) The offshoring and reshoring have an impact on the bullwhip effect in the supply chain. The bullwhip effect is a phenomenon that occurs when the demand for a product fluctuates significantly, causing the upstream supply chain to experience amplified swings in demand. When a company decides to move its production offshore, it might be difficult to manage the demand, especially when there is a difference in time zones, language, and cultural barriers between the production and the market. This increases the lead time, and if the demand fluctuates, the orders placed for the offshore product may not reflect the actual demand. This leads to higher inventory levels and bullwhip effect. When production is reshored, companies can better manage the demand for their products because they are closer to their market. This reduces the lead time, and the orders placed can better reflect the actual demand. This leads to lower inventory levels and reduces the bullwhip effect.b) A buy-back contract is an agreement between the manufacturer and the supplier that allows the supplier to return unsold goods to the manufacturer. This coordination mechanism guarantees supply chain coordination by providing a safety net for the supplier. The supplier is more likely to place orders with the manufacturer because they know that they can return the unsold goods. This reduces the supplier's risk of holding unsold inventory, and the manufacturer can better plan its production levels because it knows that the supplier will place orders for the products. This coordination mechanism ensures that the supplier is more responsive to the demand for the product and reduces the bullwhip effect.
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Question 9 9 pts CWB Inc.'s standard cost card for direct labor and variable manufacturing overhead are as follows: Standard Standard Price Direct Costs Quantity (unit: (unit:$ per hours) hour) Direct Labor 0.1 10 Manufacturing 0.1 7 Overhead Actual results were as follows: • The number of units sold and produced was 12000 units. The variable overhead cost was $5000 for 1000 hours. I Calculate the following variances. Use "U" to indicate "Unfavorable" and "F" to indicate "Favorable". For example, input "30000" for $3,000 unfavorable variance and "3000F" for $3,000 favorable variance. Do not use a thousand separator"," and do not leave space between the number and the letter U/F in your answer. Variable overhead rate variance. Variable overhead efficiency variance.
The variable overhead rate variance is $500 F and the variable overhead efficiency variance is $2000 U.
Variable overhead rate variance: Variable overhead rate variance indicates the effect of the difference between the actual and expected variable overhead rate per hour on the total variable overhead costs. The formula for variable overhead rate variance is as follows:
Variable overhead rate variance = (Actual variable overhead rate - Standard variable overhead rate) × Actual hours worked Variable overhead rate variance = ($5000 / 1000 hours - $0.1 / hour) × 1000 hours Variable overhead rate variance = $500 F Variable overhead efficiency variance:
Variable overhead efficiency variance shows the impact of the difference between the actual hours worked and the standard hours allowed on the total variable overhead costs.
The formula for variable overhead efficiency variance is as follows: Variable overhead efficiency variance = (Actual hours worked - Standard hours allowed) × Standard variable overhead rate .
Variable overhead efficiency variance = (1000 hours - 12000 hours × 7 hours per unit) × $0.1 per hourVariable overhead efficiency variance = $2000 U Therefore, the variable overhead rate variance is $500 F and the variable overhead efficiency variance is $2000 U.
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You are working for an investment bank’s shipping division in charge of credit assessment of clients. You are given two projects to look at and evaluate their credit risk.
1- The first project involves a 3 year loan for the purchase of a 5 year old MR tanker whose current market value is $30m.
2- The second project involves a 3 year loan for the purchase of a 10 year old Suezmax tanker whose current market value is $42m.
Both projects are set to operate on a one-ship-one-company basis and the companies would like to borrow as much as possible to the full price of the vessel. However, your bank has a strict policy of taking the vessel as collateral and only approving loans with a maximum default probability of 15%, in order to reduce its credit risk exposure. It is also known that both borrowers have good business and credit history; therefore, according to the assigned credit rating of borrowers, default may occur if value of the asset falls 5% below the amount borrowed.
--> Assuming that the volatility of the second price for 5-year old MR tanker is 25%, the volatility of the second price for 10-year old Suezmax tanker is 30%, the risk free rate is 3%, determine the maximum amount of funds that you are permitted to provide to each shipping company for the purchase of these vessels
The maximum amount of funds that can be provided to the shipping company for the purchase of the 5-year old MR tanker is $25.8 million, and for the 10-year old Suezmax tanker is $34.44 million, while maintaining a maximum default probability of 15% based on loan-to-value ratios and market values.
To determine the maximum amount of funds that can be provided to each shipping company while maintaining a maximum default probability of 15%, we need to calculate the loan-to-value (LTV) ratio for each project. The LTV ratio represents the loan amount as a percentage of the vessel's market value.
For the 5-year old MR tanker:
Volatility (σ) = 25%
Risk-free rate (r) = 3%
Default probability (Pd) = 15%
Loan-to-Value ratio (LTV) = 1 - Pd / (1 + r - σ²/2)
LTV = 1 - 0.15 / (1 + 0.03 - 0.25²/2)
LTV = 0.86
Maximum loan amount = LTV * Market value
Maximum loan amount = 0.86 * $30m
Maximum loan amount = $25.8m
For the 10-year old Suezmax tanker:
Volatility (σ) = 30%
Risk-free rate (r) = 3%
Default probability (Pd) = 15%
Loan-to-Value ratio (LTV) = 1 - Pd / (1 + r - σ²/2)
LTV = 1 - 0.15 / (1 + 0.03 - 0.30²/2)
LTV = 0.82
Maximum loan amount = LTV * Market value
Maximum loan amount = 0.82 * $42m
Maximum loan amount = $34.44m
Therefore, the maximum amount of funds that can be provided to the shipping company for the purchase of the 5-year old MR tanker is $25.8 million, and for the 10-year old Suezmax tanker is $34.44 million.
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.What is the effect of a second round of financing on the ownership percentages of the founders and the initial first-round investors?
How and why does the first-round investors' ownership percentage change between rounds 1 and 2?
How and why does the founder's ownership percentage change between rounds 1 and 2?
**The effect of a second round of financing on the ownership percentages of the founders and initial first-round investors is as follows:**
1. **First-Round Investors**: The ownership percentage of initial first-round investors typically decreases in the second round of financing. This reduction in ownership percentage occurs because new investors are introduced, diluting the existing ownership. The extent of dilution depends on the size of the investment, valuation of the company, and the terms negotiated during the second round.
2. **Founders**: The founder's ownership percentage can also decrease in the second round of financing. Similar to first-round investors, the introduction of new investors dilutes the founder's ownership. However, founders often have a different class of shares or preferential rights that may offer some protection against dilution. The impact on founder ownership depends on their ability to negotiate favorable terms and their willingness to accept dilution to secure additional capital for the company's growth.
The change in ownership percentages between rounds 1 and 2 is primarily driven by the infusion of new capital from second-round investors. As the company seeks additional funding, it often issues new shares to these investors, resulting in dilution of existing shareholders' ownership percentages.
The dilution occurs because the total number of shares increases, but the ownership stakes of existing shareholders remain the same. The percentage decrease in ownership depends on the size of the new investment relative to the company's valuation. Founders and first-round investors may choose to participate in the second round to maintain their ownership percentage or accept dilution to secure additional funds for the company's expansion.
In summary, a second round of financing generally leads to a decrease in ownership percentages for both founders and initial first-round investors due to the introduction of new investors and the issuance of additional shares. The specific changes in ownership depend on the terms negotiated and the decisions made by the parties involved.
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Required information. [The following information applies to the questions displayed below] Allied Merchandisers was organized on May 1. Macy Company is a major customer (buyer) of Allied (seller) products, May 3 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000). May 5 Allied sold 1,500 of the units in inventory for $14 per unit (invoice total: $21,000) to Macy Company under credit terms 2/10, n/60. The goods cost Allied $15,000. May 7 Macy returns 125 units because they did not fit the customer's needs (invoice amount: $1,750). Allied restores the units, which cost $1,250, to its inventory. May 8 Macy discovers that 200 units are scuffed but are still of use and, therefore, keeps the units. Allied gives a price reduction (allowance) and credits Macy's accounts receivable for $300 to compensate for the damage. Allied receives payment from Macy for the amount allowances, and any cash discount. ved on the May 5 purchase; payment is net of returns, May 15 Prepare the appropriate journal entries for Macy Company to record each of the May transactions. Macy is a retailer that uses the gross method and a perpetual inventory system; it purchases these units for resale. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000).
Allied purchased 2,000 units of inventory on May 3 for a total cost of $20,000. The journal entry records the increase in inventory and the corresponding increase in accounts payable.
Identify the accounts involved:
Inventory: Represents the inventory purchased by Allied.
Accounts Payable: Represents the amount owed by Allied to the supplier for the purchase.
Determine the impact on each account:
Inventory increases as Allied acquires 2,000 units of inventory.
Accounts Payable increases as Allied incurs a liability to pay for the inventory.
Write the journal entry:
Date: May 3
Accounts Payable 20,000
Inventory 20,000
The journal entry records the increase in inventory and the corresponding increase in accounts payable due to Allied's purchase of 2,000 units of inventory at a cost of $10 per unit, totaling $20,000.
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what should be the primary purpose of the talent management process?
The primary purpose of the talent management process is to identify, attract, develop, and retain the best employees in an organization.
It is a set of practices that involve the recruitment, selection, and training of employees to meet the strategic objectives of the organization and improve the performance of employees. There are several reasons why talent management is important. The first reason is that it helps organizations to identify the skills and knowledge required to perform specific jobs. This helps organizations to recruit employees who are a good fit for the job. The second reason is that it helps organizations to develop employees' skills and knowledge. By providing training and development opportunities, employees can become more skilled and productive.
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Business selling coffee makers to other businesses. On 31" December 2018 he extracted the following trial balance. Trial Balance Account Name Debit $ Credit $ 541.500 9.600 35.250 271.080 9,600 126.000 37,500 60.000 25% 15 000 9,000 256 - 27.000 Sales Revenue Sales retums Opening inventory Purchases Purchase returns Freehold property New motor vehicle (trade-in-deducted) Equipment at cost Accumulated depreciation on equipment Old Motor vehicle at cost Accumulated depreciation on old motor vehicle Salaries and Wages Insurance Motor expenses Advertising expenses Loan interest Receivables Allowance for receivables Payables Current licibilities Cash at bank Bank loan Non-Current Vabilities 10.800 18,000 4.800 7.500 4,500 6.000 61,500 4,500 (45.750 239,670 51.00 0 Capital Hotel bine Total 236,250 908,400 908,400 مع مپ ته را در یک + The following information is relevant. 1. Closing inventory was valued at $52.350. 2. Equipment is depreciated by 25% on reducing balance basis. 3. Motor vehicles are depreciated by 20% on straight-line basis.- 4. On 31 May 2018 Johns traded in his motor vehicle for a new one. The new motor veir vehicle (cost $63,000 and the trade-in value of the old motor vehicle was $25,500. AL the time Johns acquired the new motor vehicle, He recorded a cash payment of &37,500 against a new motor vehicle account. No other entries have yet been made regarding this transaction. 5. Accrued wages ht the end of 2014 amount to $4.500X 6. On 1 August 2018 Johns paid $1,800 for insurance which is valid until 31 July 2019. diss7. Trrecoverable receivables of $2,100)need to be written off, or load debts writter 8. Ahmed decides to increase the allowance for receivable by $2,400. Required: a. Prepare John's income statement for the year ending 31" December 2018. b. Prepare John's balance sheet as at December 2018. (15+15 = 30 Marks) ht +
To prepare John's income statement for the year ending December 31, 2018, and his balance sheet as of December 31, 2018, several adjustments and calculations need to be made.
1. The closing inventory of $52,350 needs to be included in the cost of goods sold calculation on the income statement.
2. Depreciation on equipment should be calculated at a rate of 25% on the reducing balance basis.
3. Depreciation on motor vehicles should be calculated at a rate of 20% on the straight-line basis.
4. The trade-in of the old motor vehicle for a new one needs to be recorded, with the cost of the new motor vehicle being $63,000 and the trade-in value of the old motor vehicle being $25,500.
5. Accrued wages of $4,500 at the end of 2018 need to be recognized as an expense on the income statement.
6. Insurance paid in August 2018 needs to be adjusted for the period it covers until July 31, 2019.
7. Unrecoverable receivables of $2,100 should be written off as an expense on the income statement.
8. The allowance for receivables should be increased by $2,400.
By making these adjustments and calculations, the income statement and balance sheet can be prepared to reflect the financial position and performance of John's business for the year ending December 31, 2018.
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In an EOQ model, the EOQ is originally determined at 100 units. When the demand rate is doubled, the new EOQ should be adjusted to O 100÷2=50 10 × 2 = 200 100 x √√2 = 141 100 x 4 = 400
When the demand rate is doubled, the new EOQ should be adjusted to 100 x √√2 = 141. Therefore, the correct option is: 100 x √√2 = 141.
How to solve for the new EOQ ?The formula for calculating EOQ is: EOQ = √(2DS / H)
Where:
D = Demand
S = Ordering cost
H = Holding cost
When the demand rate is doubled, the demand variable (D) is multiplied by 2.
That means, we can rewrite the formula as: EOQ = √(2DS(2) / H).
Now, let's consider the original EOQ as 100 units.
That means we already know D, S and H. We just have to plug in these values and solve for EOQ as follows:
100 = √(2 x D x S / H)100² = 2 x D x S / HD² x H / 2S = D = 100 x H / 2S...equation 1.
Doubling the demand rate means we have a new-
D = 2 x 100 x H / 2S = 100 x H / S.
Plugging this value in the original formula:
EOQ = √(2DS(2) / H)
EOQ = √(2 x 100 x H / S x S x 2 / H)
EOQ = 100 x √√2 / 1
EOQ = 100 x √√2 / 1 = 100 x √2 / √2
= 100 x 1.41 = 141.
Therefore, the new EOQ should be adjusted to 141.
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the expected return on karol co. stock is 18.5 percent. if the risk-free rate is 5 percent and the beta of karol co is 2.4, then what is the risk premium on the market?
To calculate the risk premium on the market, we need to subtract the risk-free rate from the expected return on Karol Co. stock. The risk premium represents the additional return an investor expects to earn for taking on the additional risk associated with investing in the stock market.
Risk premium = Expected return - Risk-free rate
Given:
Expected return on Karol Co. stock = 18.5%
Risk-free rate = 5%
Risk premium = 18.5% - 5%
Risk premium = 13.5%
Therefore, the risk premium on the market is 13.5%.
This implies that investors expect to earn an additional 13.5% return by investing in the stock market compared to investing in risk-free assets such as government bonds or treasury bills. The risk premium reflects the compensation investors require for taking on the higher volatility and uncertainty associated with stock market investments.
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Purchasing plays a key role in the value proposition of the supply chain. Which one of the following is purchasing's key role? a) Cost control b) Time management Oc) Lean efficiency d) Gate keeper
The key role of purchasing in the value proposition of the supply chain is cost control. Option a) Cost control is purchasing's primary responsibility and a fundamental aspect of its role.
Purchasing professionals are responsible for sourcing and procuring goods and services at the best possible prices, negotiating favorable terms with suppliers, and managing costs throughout the supply chain.
Effective cost control in purchasing helps to optimize expenses, reduce procurement costs, and maximize overall profitability. It involves activities such as supplier selection, negotiating contracts, managing supplier relationships, monitoring market prices, and implementing cost-saving strategies.
While time management (option b), lean efficiency (option c), and acting as a gatekeeper (option d) can also be important aspects of purchasing, cost control stands out as the primary role. By controlling costs, purchasing contributes to the organization's competitiveness, profitability, and ability to deliver value to customers while maintaining a sustainable supply chain.
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Define bull market and bear market. Explain the following technical indicators and discuss their buy signal: (a) bond default spread (b) exponential moving average (c) stochastic.
A bull market is characterized by rising prices and positive sentiment, while a bear market has declining prices and negative sentiment; the buy signals for the bond default spread, exponential moving average, and stochastic are a narrowing spread, price crossing above the EMA, and stochastic crossing above the oversold level, respectively.
A bull market is a financial market characterized by rising prices and positive investor sentiment, typically accompanied by optimism and a belief that upward price trends will continue. It is associated with increasing buying activity and often represents a strong economy.
(a) Bond default spread: The bond default spread is the difference in yields between a government bond and a corporate bond. A widening bond default spread indicates increased credit risk and investor concerns about the potential for corporate bond defaults. A buy signal in this context would occur when the bond default spread narrows, signaling reduced credit risk and increased investor confidence in corporate bonds.
(b) Exponential moving average (EMA): The exponential moving average is a technical indicator that calculates the average price of a security over a specific period, giving more weight to recent prices. A buy signal occurs when the security's price crosses above its EMA, indicating a potential upward trend and suggesting it may be a good time to buy the security.
(c) Stochastic: Stochastic is a momentum indicator used to identify overbought and oversold conditions in a security. It compares the security's closing price to its price range over a specified period. A buy signal is generated when the stochastic oscillator crosses above the oversold level (typically below 20), indicating a potential upward reversal and suggesting a buying opportunity.
It's important to note that technical indicators provide insights into market trends and potential buy or sell signals, but they should be used in conjunction with other analysis tools and considerations to make informed investment decisions.
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what is a danger associated with not negotiating for salary? group of answer choices you will be underpaid. your underpayment will reverberate through your career via the power of compounding. the employer will start to question the wisdom of hiring you. all of the other factors are dangers associated with failing to negotiat
The danger associated with not negotiating for salary is that you will be underpaid. The strength of compounding will cause the underpayment you received to affect your entire career. The prudence of hiring you will be called into question by the employer.
When you fail to negotiate for salary, you risk accepting a compensation package that is lower than what you deserve or what is aligned with the market value for your skills and experience. This can have long-term consequences for your career and financial well-being. Here's an explanation of the danger:
Underpayment: By not negotiating, you may end up with a salary that is lower than what you could have obtained through negotiation. This means you may be earning less than your colleagues or counterparts in similar positions. Over time, this can result in financial dissatisfaction and hinder your ability to meet your financial goals.
Compounding effect: The impact of accepting a lower salary can reverberate throughout your career due to the power of compounding. Salary increases and future job offers are often based on your previous salary. If you start with a lower salary, subsequent raises and new job offers may be calculated as a percentage of that lower base, perpetuating the gap between your actual worth and your compensation.
Employer perception: Failing to negotiate for salary may signal to the employer that you are not confident in your abilities or do not value yourself appropriately. It can create doubts about your assertiveness and negotiation skills, potentially affecting how they view your overall suitability for the role and your commitment to maximizing your own value.
Missed opportunities: Not negotiating can result in missed opportunities for financial growth and advancement. Salary negotiations not only impact your current earnings but also set the foundation for future negotiations and career progression. By not advocating for yourself, you may miss out on higher salaries, better benefits, bonuses, and other perks that can contribute to your financial stability and professional satisfaction.
not negotiating for salary can lead to being underpaid, which has a compounding effect on your career and financial well-being. It may also impact how employers perceive your value and limit your opportunities for future growth. It is important to advocate for yourself and negotiate to ensure fair and competitive compensation that reflects your worth and contributes to your long-term success.
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Bond Discount, Entries for Bonds Payable Transactions On July 1, Year 1, Livingston Corporation, a wholesaler of manufacturing equipment, issued $1,800,000 of 8-year, 11% bonds at a market (effective) interest rate of 12%, receiving cash of $1,709,047. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year.
To record the bond issuance transaction on July 1, Year 1, we need to calculate the bond discount first. The bond discount is the difference between the face value of the bonds and the cash received when the market interest rate is higher than the stated interest rate.
Step 1: Calculate the bond discount:
Face value of the bonds = $1,800,000
Cash received = $1,709,047
Bond discount = Face value of the bonds - Cash received
Bond discount = $1,800,000 - $1,709,047
Bond discount = $90,953
Step 2: Record the bond issuance transaction:
Date: July 1, Year 1
Record the cash received:
Cash $1,709,047
Bonds Payable $1,709,047
Record the bond discount:
Bonds Payable $90,953
Discount on Bonds Payable $90,953
The entry above records the cash received from the bond issuance and the bond discount as liabilities on the balance sheet. The bond discount will be amortized over the life of the bonds and recorded as an interest expense.
Let me know if you need further assistance with the subsequent interest payment transactions or any other related entries.
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If a company’s equity beta increases, which of the following are possible causes of the increase?
A. The company’s operating leverage has decreased
B. The company’s financial leverage has increased
C. The company’s net working capital has increased
D. All of the above
All of the above factors can potentially cause an increase in a company's equity beta.
The equity beta measures the sensitivity of a company's stock price to changes in the overall market. An increase in equity beta indicates that the stock's price is expected to move more in line with market movements.
A. The company's operating leverage has decreased:
Operating leverage refers to the extent to which a company uses fixed costs in its operations. If a company's operating leverage decreases, it means that it is relying less on fixed costs and more on variable costs. This change can lead to a decrease in the company's equity beta.
B. The company's financial leverage has increased:
Financial leverage refers to the use of debt to finance a company's operations. If a company increases its financial leverage by taking on more debt, it can increase the company's equity beta. This is because debt introduces additional financial risk, which can amplify the company's sensitivity to market movements.
C. The company's net working capital has increased:
Net working capital represents the difference between a company's current assets and current liabilities. If a company's net working capital increases, it means that it has more liquidity and a stronger financial position. This increase in financial stability can lead to a decrease in the company's equity beta.
Therefore, all of the above factors can potentially cause an increase in a company's equity beta.
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A Limited is a company that sells office furniture in the Cape Town region. As the sales of A Limited are increasing the company needed more storage space for the furniture and moved its furniture out of a warehouse property that it owns in Bellville, into a larger property on 30 June 2018. This Bellville property that it owned was then leased out on 30 June 2018 to an unrelated party under a non-cancellable operating lease. A Limited bought the warehouse property in Bellville on 1 January 2013 for R6 000 000. The land was valued at R2 000 000 and the building was valued at R4 000 000. The estimated useful life of the warehouse building was estimated to be 25 years and the residual value was estimated to be R1 000 000. On 31 December 2016 A Limited decided to revaluc land and buildings for the first time and the fair value of the land was R3 000 000 and the fair value of the warchouse building was R3 000 000.
Based on the information provided, A Limited is a company that sells office furniture and owns a warehouse property in Bellville.
However, due to the increasing sales and the need for more storage space, the company decided to move its furniture out of the Bellville property and lease it to an unrelated party under a non-cancellable operating lease.
The Bellville property was purchased by A Limited on January 1, 2013, for R6,000,000. The land portion of the property was valued at R2,000,000, and the building portion was valued at R4,000,000. The estimated useful life of the warehouse building was determined to be 25 years, with a residual value of R1,000,000.
On December 31, 2016, A Limited decided to revalue the land and buildings for the first time. The fair value of the land was determined to be R3,000,000, and the fair value of the warehouse building was also R3,000,000.
This information suggests that A Limited made a strategic decision to lease out the Bellville property to generate rental income while utilizing a larger property for its own furniture storage needs. The revaluation of the property in 2016 indicates a potential increase in its market value, which could positively impact the company's financial position.
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Suppose the economy's real output grows at an average rate of 3 percent per year. And suppose there is a 7 percent average rate of growth in the money supply, and velocity is constant. How would the inflation rate be affected? a. The inflation rate would be -4 percent. b. The inflation rate would be 4 percent. c. The inflation rate would be 7 percent. d. The inflation rate would be 10 percent.
The inflation rate would be 4 percent.In economics, the relationship between the growth rate of the money supply and inflation is characterized by the equation:MV = PQ,where M is the supply of money, V is the velocity of money, P is the price level, and Q is the economy's real output.Suppose the economy's real output grows at an average rate of 3 percent per year. And suppose there is a 7 percent average rate of growth in the money supply, and velocity is constant.If velocity remains constant, the relationship between changes in the money supply and changes in nominal GDP is direct. A 7% increase in the money supply results in a 7% increase in nominal GDP if velocity is stable. This would cause the price level to rise by about 4%, given a 3% increase in real GDP. Therefore, the inflation rate would be 4 percent.Option b: The inflation rate would be 4 percent.
When a good comprises only a small portion of the budget, the consumer can reduce the con- sumption of other goods when the price of the good increases. For example, most consumers spend very little on salt; a small increase in the price of salt would reduce quantity demanded very little since salt constitutes a small fraction of consumers' total budgets. Table 3-3 Selected Short- and Long-Term Own Price Elasticities Short-Term Own Long-Term Own Price Elasticity Market Price Elasticity Transportation -0.6 -0.7 -2.3 Alcohol and tobacco -0.3 -0.9 -3.5 Recreation -0.9 -2.9 Clothing SOURCE: M. R. Baye, D. W. Jansen, and J. W. Lee. "Advertising Effects in Complete Demand Systems, Applied Economics 24 (1992), pp. 1087-96.
The elasticity of demand is affected by the price of a good or service. A product that costs a lot of money compared to the individual's budget has a higher elasticity of demand than a product that is less expensive. Elasticity can be measured in both the short and long term.
The long-term elasticity of demand reflects how people adjust their spending patterns over time, while the short-term elasticity of demand reflects how people adjust their spending patterns in response to immediate price changes. The short-term and long-term own-price elasticities of demand for various products are provided in Table 3-3.
When the price of a product rises, the consumer can reduce consumption of other goods, particularly when the product is only a small part of the budget. Salt is a good example of a product that is not a significant part of consumers' total budgets, so a small increase in salt price would have a relatively minor effect on quantity demanded.
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1–B.) Show a situation where this farmer is making economic profits. Explain what is likely to
happen in this market as a result of this condition. Assume that this one farmer is one of many
farmers making an economic profit and the high prices that lead to the economic profit has a very
strong influence on potential market participants.
One situation where the farmer is making economic profits is where the price of the product is high in the market due to either increased demand or decreased supply. In this situation, the farmer is making an economic profit because the revenue received from the sale of the product is greater than the costs incurred in producing it.
For instance, if the price of maize increases due to an increased demand for maize products such as animal feed, the farmer producing maize will earn an economic profit.
When one farmer is making an economic profit, other farmers will likely enter the market to share in the profits. This is because potential market participants will see the high returns earned by the farmer and seek to benefit from the same returns. As a result, the increased competition will result in a higher supply of the product, leading to a decrease in the price of the product in the market.
When the price decreases, the farmers will incur normal profits, which are equal to the opportunity cost of production. Normal profits occur when the revenue earned from the sale of the product is equal to the costs incurred in producing it, including the opportunity cost of production. Thus, the high prices that lead to the economic profit will be short-lived as more farmers enter the market, increasing the supply and decreasing the price of the product.
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Sun Instruments expects to issue new stock at $40 a share with estimated flotation costs of 8 percent of the market price. The company currently pays a $1.90 cash dividend and has a 7 percent growth rate. What are the costs of retained earnings and new common stock? Round your answers to two decimal places.
Costs of retained earnings: %
Cost of new common stock: %
the cost of new common stock is 36.00%.Hence, the costs of retained earnings and new common stock are 29.00% and 36.00%, respectively.
Costs of Retained Earnings and New Common Stock: Retained earnings refer to a company's net income that is kept in reserve rather than being distributed as a dividend. On the other hand, the cost of new common stock is the total cost of the shares issued by the company.Here, Sun Instruments expects to issue new stock at $40 a share with estimated flotation costs of 8% of the market price. The company currently pays a $1.90 cash dividend and has a 7% growth rate.Instruments Costs:Cost of Retained Earnings:The cost of retained earnings is equivalent to the required rate of return for the company's shareholders. The Gordon Growth Model formula is used to estimate the cost of retained earnings:Kre = D1 / (P0 - F) + gWhere,Kre is the cost of retained earningsD1 is the expected dividendP0 is the current market price of the stockF is the flotation cost of new sharesg is the growth rateSubstituting the given values,
Kre = 1.9(1 + 0.07) / ($40 - ($40 * 0.08)) + 0.07Kre = 10.65 / $36.80Kre = 0.29 = 29.00%
(rounded off to two decimal places)Hence, the cost of retained earnings is 29.00%.Cost of New Common Stock:The cost of new common stock can be calculated using the following formula:
Kn = (D1 / (P0 - F)) + gKn = (1.9(1 + 0.07) / ($40 - ($40 * 0.08))) + 0.07Kn = 10.65 / $36.80Kn = 0.29 + 0.07Kn = 0.36 = 36.00% (rounded off to two decimal places)
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-In technical writing unabashed creative self expression is the
best way to persuasively satisfy your audience's needs.
- True or False
The statement "In technical writing, unabashed creative self-expression is the best way to persuasively satisfy your audience's needs" is false.
What is technical writing?
Technical writing is the process of simplifying complex information to make it easier for others to understand. The purpose of technical writing is to communicate complex information to a specific audience. It is commonly used to write technical reports, manuals, proposals, and other types of communication that include technical information.
Technical writing must be clear, concise, and easily understood by the intended audience.
What is the importance of technical writing?
The goal of technical writing is to provide technical information that is easily understood by the intended audience. In order to do this, technical writers use a variety of techniques to simplify complex information and make it more accessible. These techniques include using clear and concise language, breaking down complex ideas into smaller parts, and using visual aids such as diagrams and charts to illustrate complex concepts.
Technical writing is an important skill because it enables individuals to communicate complex information to a wide range of audiences. This is particularly important in fields such as engineering, science, and technology where complex information is often required to make informed decisions.
By mastering technical writing skills, individuals are better equipped to communicate their ideas and contribute to the development of new technologies and innovations.In conclusion, unabashed creative self-expression is not the best way to persuasively satisfy your audience's needs when it comes to technical writing. Technical writing should be clear, concise, and easily understood by the intended audience.
Technical writing involves the use of clear and simple language to communicate complex information, which can be challenging but ultimately rewarding.
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Bonita Corporation began operations on January 2. Its year end is December 31, and it adjusts its accounts annually. Selected transactions for the current year follow: 1. 2. On January 2. purchased supplies for $4.260 cash. A physical count at December 31 revealed that $670 of supplies were still on hand. Purchased a vehicle for $44.800 on April 1, paying $4.000 cash and signing a $40,800 bank loan for the balance. The vehicle is estimated to have a useful life of 5 years and the company uses straight-line depreciation. The bank loan has an interestof 3%. Purchased a $3,540. one-year insurance policy for cash on August 1. The policy came into effect on that date. Received a $1.490 advance cash payment from a client on November 9 for services to be performed in the future. As at December 31, half of these services had been completed On December 1, the company rented additional office space for a six-month period starting on December 1 for $1,080 each month. It paid rent for the months of December and January in advance on this date
To record the selected transactions for Bonita Corporation, we will go through each transaction and analyze its impact on the accounts.
January 2: Purchased supplies for $4,260 cash.
Increase the Supplies account by $4,260 and decrease the Cash account by $4,260.
April 1: Purchased a vehicle for $44,800. Paid $4,000 cash and signed a $40,800 bank loan for the balance. The vehicle has a useful life of 5 years, and the company uses straight-line depreciation. The bank loan has an interest of 3%.
Increase the Vehicle account by $44,800 and decrease the Cash account by $4,000.
Create a Liability account for the Bank Loan for $40,800.
Record an expense for the interest on the loan. Calculate the interest as 3% of $40,800 for the period from April 1 to December 31.
August 1: Purchased a one-year insurance policy for $3,540 in cash. The policy came into effect on that date.
Create a Prepaid Insurance asset account for $3,540 and decrease the Cash account by $3,540.
November 9: Received a $1,490 advance cash payment from a client for future services. As of December 31, half of these services had been completed.
Increase the Cash account by $1,490.
Record a liability in the Unearned Revenue account for $1,490.
December 1: Rented additional office space for a six-month period starting on December 1 for $1,080 each month. Paid rent for the months of December and January in advance on this date.
Decrease the Cash account by $2,160 ($1,080 for December and $1,080 for January).
Create a Prepaid Rent asset account for $2,160.
Based on the information provided, we can now update the respective accounts and prepare the necessary journal entries.
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