Answer: FASB ACS 305-10-20
Explanation:
The FASB Accounting Standards Codification simply refers to the source with regards to accounting principles that are generally accepted.
It should be noted that the specific seven-digit Codification citation that describes the guidelines for determining the items that should be deemed cash equivalents is FASB ACS 305-10-20. The main guideline contained here is that cash equivalents can be changes easily to cash.
Benny is 57 years old and is employed by the state as a school bus driver.He has an exemplary record,with no accidents in the past 27 years.Tom,aged 31,replaces Benny.Benny intends to file a discrimination claim under the Age Discrimination in Employment Act (ADEA)with the Equal Employment Opportunity Commission.If Benny lives in a state that has not waived sovereign immunity,which of the following statements is most likely to be true?
A) Benny has a valid claim and can sue the state because he can establish all of the elements of a prima facie case.
B) Benny cannot file a claim for age discrimination under the ADEA because he is a state employee.
C) Benny is a state employee and must file his claim pursuant to the Older Workers' Benefit Protection Act.
D) Benny does not have a claim for age discrimination under the ADEA as he was replaced by an employee who is older than 30.
Answer: B. Benny cannot file a claim for age discrimination under the ADEA because he is a state employee.
Explanation:
Based on the information given in the question, since Benny lives in a state that has not waived sovereign immunity, thus simply means that Benny cannot file a claim for age discrimination under the ADEA because he is a state employee.
Eben though the Age Discrimination in the Employment Act protects workers that are 40 years and above and Benny is 57 years, it should be noted that in the states whereby sovereign immunity hasn't been waived, the state employees cannot due their employers as they're barred from doing so.
Therefore, the correct option is B.
Recently, some college alumni started a moving service for students living on campus. They have 3 employees and are debating hiring one more. The hourly wage for an employee is $30 per hour. An average moving job takes 4 hours. The company currently does 3 moving jobs per week, but with one more employee, the company could manage 5 jobs per week. The company charges $100 for a moving job.
Instructions:
Round your answers to the nearest whole number.
a. The new employee's marginal product of labor is ______.
b. The value of that merginal product is ______.
c. The moving service should moving jobs ______- hire another worker.
Answer: a. 2
b. $200
c. Should not
Explanation:
a. The new employee's marginal product of labor is ______.
This will be:
= 5 - 3
= 2 moving jobs
b. The value of that marginal product is ______..
Since the company charges $100 for a moving job, the value of the marginal product will be:
= 2 × $100
= $200
c. The moving service should moving jobs ______- hire another worker
Marginal cost of moving 2 jobs will be:
= $30 × 4 × 2
= $240
Since the marginal cost is more than the marginal product, the company should not hire another worker.
Ralph, knowing that his son, Ed, desires to purchase a tract of land, promises to give him the $25,000 he needs for the purchase. Ed, relying on this promise, buys an option on the tract of land. Now Ralph wants to rescind his promise to Ed. Will Judy be required to give her daughter, Liza, the tract of land on which she has started to build, and will Ralph be required to give his son, Ed $25,000 to purchase a tract of land. Can Ralph rescind his promise?
Answer:
(a) Yes, Judy will be required to give her daughter, Liza, the tract of land on which she has started to build. Therefore, Judy cannot rescind his promise to Liza.
(b) No, Ralph will NOT be required to give his son, Ed $25,000 to purchase a tract of land. Therefore, Ralph can rescind his promise.
Explanation:
Note: This question is not complete. The complete question is therefore provided before answering the question as follows:
(a) Judy orally promises her daughter, Liza, that she will give her a tract of land for her home. Liza, as intended by Judy, gives up her homestead and takes possession of the land. Liza lives there for six months and starts construction of a home. Now Judy wants to rescind his promise to Liza.
(b) Ralph, knowing that his son, Ed, desires to purchase a tract of land, promises to give him the $25,000 he needs for the purchase. Ed, relying on this promise, buys an option on the tract of land. Now Ralph wants to rescind his promise to Ed.
Will Judy be required to give her daughter, Liza, the tract of land on which she has started to build, and will Ralph be required to give his son, Ed $25,000 to purchase a tract of land. Can Ralph rescind his promise?
Explanation of the answers is now provided as follows:
Each of the two cases will be decided based on the principle promissory estoppel.
Promissory estoppel refers to the legal principle that states that despite that there us formal consideration attached to a promise, it is still enforceable by law if the promise from the promisor makes the promisee to rely on the promise to his subsequent detriment.
(a) Will Judy be required to give her daughter, Liza, the tract of land on which she has started to build?
Yes, Judy will be required to give her daughter, Liza, the tract of land on which she has started to build.
The is because Liza has relied on the promise from Judy to her subsequent detriment by giving up her up her homestead and already starts construction of a home. Since the Judy promise from Judy induces the action of Liza that is reasonably expected by Judy, he cannot rescind his promise to Liza.
(b) Will Ralph be required to give his son, Ed $25,000 to purchase a tract of land. Can Ralph rescind his promise?
No, Ralph will NOT be required to give his son, Ed $25,000 to purchase a tract of land.
This is because there is Ed has not taken any definite and substantial action to justify that he has relied on the promise from Ralph to his subsequent detriment. It may not be possible to construe the purchase of an option on the tract of land by Ed as a definite and substantial action. Therefore, Ralph can rescind his promise.
Zeffer is a small but growing bottling company that competes with large soft drink heavy-hitters. To set itself apart, Zeffer has decided to develop a line of all-natural soft drinks that are believed to be healthier than typical high-calorie sodas. The company hopes that these soft drinks will become popular in various sectors of the U.S. market. Answer the following question based on the scenario described above. Zeffer executives have decided to focus marketing efforts on the ________ market, since this group is expected to grow more rapidly than
Answer:
Hispanic
Explanation:
In the United States Hispanic population has continued to be responsible for half of the total population growth since 2010 till date.
In this time Hispanics contributed 52% to the 18.9 million population growth in the United States.
Based on this trend Zeffer has decided to develop a line of all-natural soft drinks that are believed to be healthier than typical high-calorie sodas and targeting the Hispanic market will make their product popular rapidly.
A college uses advisors who work with all students in all divisions of the college. The most useful allocation basis for the salaries of these employees would likely be: Multiple Choice number of classes offered in each division. student graduation rate. square footage of each division. number of students advised from each division. relative salaries of division heads.
Answer: number of students advised from each division
Explanation:
When a company uses a
allocation rate there is only one base for allocating all overhead costs to products or other cost objects.
Answer:
company-wide
Explanation:
Using a single company-wide allocation rate implies that only one cost driver (or cost base) is used to allocate all the overhead costs to the product units, batches, departments, or divisions, and other cost objects. This single rate is the plant-wide or company-wide allocation rate. It is opposed to the use of multiple allocation rates, where different rates are calculated and used to allocate overhead costs from different cool pools to the units or activities consuming the services. The company-wide allocation rate is typical with traditional costing method, while the multiple allocation rates are used with ABC costing method.
Match each of the following terms with the correct definition:
a. additional paid-in capital
b. issued and outstanding
c. retained earnings
d. treasury stock
e. authorized share capital
f. par value
Correct Definitions:
A. The price at which each share is recorded in the company’sbooks
B. Held by investors
C. Cumulative amount of profits that have been plowed back
D. The difference between the amount of cash raised by anequity issue and the par value of the issue
E. The maximum number of shares that can be issued withoutshareholder approval
F. The amount that the company has spent
Oak Corp., a calendar-year corporation, was formed three years ago by its sole shareholder, Glover, and has always operated as a C corporation. However, at the beginning of this year, Glover made a qualifying S election for Oak Corp., effective January 1. Oak Corp. did not have any C corporation earnings and profits on that date. On June 1, Oak Corp. distributed $15,000 to Glover. What are the amount and character of gain Glover must recognize on the distribution, and what is his basis in his Oak Corp. stock in each of the following alternative scenarios?
a. At the time of the distribution, Glover’s basis in his Oak Corp. stock was $35,000.
b. At the time of the distribution, Glover’s basis in his Oak Corp. stock was $8,000.
c. At the time of the distribution, Glover’s basis in his Oak Corp. stock was $0.
Answer:
Oak Corp distributed $15,000 to Glover and we are required to compute the amount and character of gain Glover must recognize under the scenarios as stated in the question:
a. No gain will be recognized by Glover. Rather, his stock basis will be reduced from $35,000 to $20,000 ($35,000 basis - $15,000 cash distribution). So, gain recognized by him is $0.
b. Long term capital gain of $7,000 ($15,000 - $8,000) will be recognized by Glover and his stock basis will be reduced from $8,000 to $0.
c. The entire $15,000 ($15,000-$0) will be recognized as long term capital gain by Glover and his stock basis will remain $0.
A company reports the following: Sales $3,150,000 Average accounts receivable (net) 210,000 Determine (a) the accounts receivable turnover and (b) the number of days' sales in receivables. Round interim calculations to the nearest dollar and final answers to one decimal place. Assume a 365-day year. a. Accounts receivable turnover fill in the blank 1 b. Number of days' sales in receivables
Answer:
a. Account Receivables turnover = Sales / Average Account Receivables
Account Receivables turnover = $3,150,000 / $210,000
Account Receivables turnover = 15
b. Number of days sales in receivables = 365 / Account Receivables turnover
Number of days sales in receivables = 365 days / 15
Number of days sales in receivables = 24.33 days
Required information: Analyzing income effects from eliminating departments.
Suresh Co. expects its five departments to yield the following income for next year.
Dept. M Dept. N Dept. O Dept. P Dept. T Total
Sales $66,000 $38,000 $59,000 $45,000 $31,000 $239,000
Expenses
Avoidable 11,300 38,200 23,300 15,500 40,500 128,800
Unavoidable 53,000 14,400 4,500 31,200 11,900 115,000
Total expenses 64,300 52,600 27,800 46,700 52,400 243,800
Net income (loss) $1,700 $(14,600) $31,200 $(1,700) $(21,400) $(4,800)
Re-compute and prepare the departmental income statements (including a combined total column) for the company under each of the following separate scenarios.
1) Management eliminates departments with sales dollars that are less than avoidable expenses.
2) Management eliminates departments with expected net losses.
Answer and Explanation:
The computation and the preparation is presented below:
1.
Particulars Dept. M Dept. N Dept. O Dept. P Dept. T Total
Sales $66,000 $59,000 $45,000 $170,000
Expenses
Avoidable $11,300 $23,300 $15,500 $50,100
Unavoidable $53,000 $14,400 $4,500 $31,200 $11,900 $115,000
Total expense $64,300 $14,400 $27,800 $46,700 $11,900 $165,100
Net income
or loss $1,700 -$14,400 $31,200 -$1,700 -$11,900 $4,900
2.
Particulars Dept. M Dept. N Dept. O Dept. P Dept. T Total
Sales $66,000 $59,000 $125000
Expenses
Avoidable $11,300 $23,300 $34,600
Unavoidable $53,000 $14,400 $4,500 $31,200 $11,900 $115,000
Total expense $64,300 $14,400 $27,800 $31,200 $11,900 $149,600
Net income
or loss $1,700 -$14,400 $31,200 -$31,200 -$11,900 -$24,600
Waterway Industries is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6400000 on March 1, $5250000 on June 1, and $8650000 on December 31. Waterway Industries borrowed $3200000 on January 1 on a 5-year, 11% note to help finance construction of the building. In addition, the company had outstanding all year a 9%, 3-year, $6440000 note payable and an 10%, 4-year, $12550000 note payable.
Required:
What are the weighted-average accumulated expenditures?
Answer:
$8,395,833
Explanation:
Calculation to determine What are the weighted-average accumulated expenditures
Weighted-average accumulated expenditures
=($6,400,000 × 10/12) + ($5,250,000 × 7/12) + ($8,650,000 × 0/12)
Weighted-average accumulated expenditures=$5,333,333+$3,062,500+0
Weighted-average accumulated expenditures=$8,395,833
Therefore the weighted-average accumulated expenditures will be $8,395,833
Wesley, who is single, listed his personal residence with a real estate agent on March 3 of the current year at a price of $390,000. He rejected several offers in the $350,000 range during the summer. Finally, on August 16, he and the purchaser signed a contract to sell for $363,000. The sale (i.e., closing) took place on September 7. The closing statement showed the following disbursements:
Real estate agent's commission $21,780
Appraisal fee 600
Exterminator's certificate 300
Recording fees 800
Mortgage to First Bank 305,000
Cash to seller 34,520
Wesley's adjusted basis for the house is $200,000. He owned and occupied the house for seven years. On October 1, 2017, Wesley purchases another residence for $325,000.
a. Wesley's recognized gain on the sale is __________
b. Wesley's adjusted basis for the new residence is ___________
c. Assume instead that the selling price is $800,000.
Wesley's recognized gain is _____________, and his adjusted basis for the new residence is __________
Answer:
a. Wesley's recognized gain on the sale is $0.
b. Wesley's adjusted basis for the new residence is $325,000
c. Assume instead that the selling price is $800,000.
Wesley's recognized gain is $326,520, and his adjusted basis for the new residence is $325,000.
Explanation:
Wesley's actual gain = $363,000 - $21,780 - $600 - $300 - $800 - $200,000 = $139,520, but it can all be excluded using section 121.
If the selling price is $800,000;
Wesley's actual gain = $800,000 - $21,780 - $600 - $300 - $800 - $200,000 = $576,520, but he can exclude $250,000, so his recognized gain = $326,520
According to the attraction-selection-attrition (ASA) theory, job applicants Question 27 options: do not typically pay much heed to organizational values when applying for work. with a variety of personal characteristics are preferred by organizations, resulting in a more heterogeneous organization. avoid employment in companies whose values seem incompatible with their own values. avoid other applicants if they are competing for the same jobs.
Answer:
avoid employment in companies whose values seem incompatible with their own values.
Explanation:
Unemployment rate refers to the percentage of the total labor force in an economy, who are unemployed but seeking to be gainfully employed. The unemployment rate is divided into various types, these include;
I. Natural Rate of Unemployment (NU).
II. Frictional unemployment rate (FU).
III. Structural unemployment rate (SU).
IV. Actual unemployment rate (AU).
V. Cyclical unemployment rate (CU).
The attraction-selection-attrition (ASA) theory was developed and introduced by Benjamin Schneider. This theory typically gives the reason why a business firm or organization looks and feels the way it does with respect to the employees and employers.
According to the attraction-selection-attrition (ASA) theory, job applicants avoid employment in companies whose values seem incompatible with their own values. Also, it states that job applicants are usually attracted to colleagues having similar assumptions and values.
The management accountant for Giada's Book Store has prepared the following income statement for the most current year: Cookbook Travel Book Classics Total Sales $63,000 $179,000 $60,000 $302,000 Cost of goods sold 37,000 70,000 23,000 130,000 Contribution margin 26,000 109,000 37,000 172,000 Order and delivery processing 19,000 26,000 9,000 54,000 Rent (per sq. foot used) 3,000 3,000 3,000 9,000 Allocated corporate costs 10,000 10,000 10,000 30,000 Corporate profit $ (6,000) $70,000 $15,000 $79,000 If the cookbook product line had been discontinued prior to this year, the company would have reported ________. the same amount of corporate profits less corporate profits greater corporate profits resulting profits cannot be determined
Answer:
the company would have reported loss
Lily Company sells automatic can openers under a 75-day warranty for defective merchandise. Based on past experience, Lily estimates that 4% of the units sold will become defective during the warranty period. Management estimates that the average cost of replacing or repairing a defective unit is $20. The units sold and units defective that occurred during the last 2 months of 2020 are as follows:
Months Units Sold Units Defective Prior to December 31
November 37,300 746
December 39,300 491
Required:
a. Prepare the journal entries to record the estimated liability for warranties and the costs incurred in honoring 1,237 warranty claims.
b. Determine the estimated warranty liability at December 31 for the units sold in November and December.
Answer and Explanation:
The computation is shown below:
In November month:
Estimated defective units:
= Estimated Percentage to be defective units × Units sold
= 4% × 37,300
= 1,492
The Estimated cost of repairing defective units is
= Estimated defective units × Estimated cost of repairing the defective unit
= 1,492 × $20
= $29,840
In December month:
Estimated defective units:
= Estimated Percentage to be defective units × Units sold
= 4% × 39,300
= 1,572
The Estimated cost of repairing defective units:
= Estimated defective units × Estimated cost of repairing the defective unit
= 1,572 × $20
= $31,440
Now the Total estimated liability is
= $29,840 + $31,440
= $61,280
The Journal entries are as follows:
(a) Warranty expenses A/c Dr. $61,280
To Estimated warranty payable $61,280
(Being warranty expense is recorded)
Estimated warranty payable A/c Dr. $24,740
To Cash/ Material consume $24,740
(being cash paid is recorded)
(b) The estimated warranty liability is $61,280
Suppose you trade dollars and euros for a bank that has branches in Los Angeles and Frankfurt. You can electronically transfer the funds between the two branch locations at no cost, and trading commissions are negligible. The current dollar-per-euro exchange rate in Los Angeles is E$/EURLA=1.5653 , while in Frankfurt, it is E$/EURFR=1.586.
You can make a profit for the bank if you buy euros in _______ and sell them in _________.
Answer:
Explanation:
Profit will be made by you for the bank if you buy the Euros in Los Angeles, and sell the Euros to customers in Frankfurt...
Buying in Los Angeles comes at a price of $1 = €1.5653, then going ahead to sell in Frankfurt means you get to sell it at a rate of $1 = €1.586
Although this is a very tiny difference, of 0.0207. The reality is that when you're doing a lot of tradings that involves currency, you tend to see the profit. If for example, a total of $1 million is traded, then the profit would be $20700, which we all can attest to the fact that it's a lot of money.
The excess return is computed by ________ the average return for the investment. Group of answer choices subtracting the inflation rate from adding the inflation rate to subtracting the average return on the U.S. Treasury bill from adding the average return on the U.S. Treasury bill to subtracting the average return on long-term government bonds from
Answer:
The answer is "subtracting the average return on the U.S. Treasury bill from".
Explanation:
By subtracting the average annual return on the US Treasury bill form of the investment's average return, that excess return is calculated, when the risk premium is another term for excess return. After subtracting the risk-free return from its investment's annualized value, the risk premium is calculated its avg treasury bond investment is a risk-free portfolio.
"Minimum wage laws cause unemployment because the legal minimum wage is set" 9) A) above the market wage, causing labor demand to be greater than labor supply. B) below the market wage, causing labor demand to be greater than labor supply. C) too low. D) below the market wage, causing labor demand to be less than labor supply. E) above the market wage, causing labor demand to be less than labor supply.
Answer: E) above the market wage, causing labor demand to be less than labor supply.
Explanation:
Minimum wage simply refers to the lowest wage that employers can pay their workers. Minimum wage is a form of price floor which means that it's typically higher than the equilibrium or market wage.
In this case, since it's higher than the market wage, there'll be an increase in the supply of labor as those that are unemployed will be willing to work duw to the increase in the wage rate.
On the other hand, there'll be a reduction in the demand for labor as employers typically will want to reduce cost and won't be interested in employing more workers.
Therefore, the correct option is E
Brussels Enterprises issues bonds at par dated January 1, 2020, that have a $2,000,000 par value, mature in four years, and pay 9% interest semiannually on June 30 and December 31. 1. Record the entry for the issuance of bonds for cash on January 1. 2. Record the entry for the first semiannual interest payment and the second semiannual interest payment. 3. Record the entry for the maturity of the bonds on December 31, 2023 (assume semiannual interest is already recorded).
Answer:
1. January 1
Dr Cash $2,000,000
Cr Bonds Payable $2,000,000
2. June 30
Dr Bond Interest Expense $90,000
Cr Cash $90,000
December 31
Dr Bond Interest Expense $90,000
Cr Cash $90,000
3. December 31
Dr Bonds Payable $2,000,000
Cr Cash $2,000,000
Explanation:
1. Preparation of the journal entry to Record the issuance of bonds for cash on January 1.
January 1
Dr Cash $2,000,000
Cr Bonds Payable $2,000,000
(To Record the issuance of bonds for cash )
2. Preparation of the journal entries to Record the first semiannual interest payment and the second semiannual interest payment
June 30
Dr Bond Interest Expense $90,000
Cr Cash $90,000
(9%/2*$2,000,000)
(To Record the first semiannual interest payment)
December 31
Dr Bond Interest Expense $90,000
Cr Cash $90,000
(9%/2*$2,000,0000)
(To Record the second semiannual interest payment)
3. Preparation of the journal entry to Record the maturity of the bonds on December 31, 2023
December 31
Dr Bonds Payable $2,000,000
Cr Cash $2,000,000
(To Record bonds maturity )
Bramble Corp. purchased land as a factory site for $1305000. Bramble paid $121000 to tear down two buildings on the land. Salvage was sold for $8400. Legal fees of $5340 were paid for title investigation and making the purchase. Architect's fees were $47000. Title insurance cost $3900, and liability insurance during construction cost $4200. Excavation cost $15480. The contractor was paid $4400000. An assessment made by the city for pavement was $9900. Interest costs during construction were $251000.
1. The cost of the land that should be recorded by Wilson Co. is:_____.
a. $989,880
b. $980,480
c. $996,280
d. $986,880
The cost of the building should be recorded by Wilson Co. is:_____.
a. 2,804,840
b. 2,813,200
c. 2,803,800
d. 3,014,240
Answer:
Part 1
$1,422,940
Part 2
$331,480
Explanation:
cost of the land calculation
Purchase Price $1305000
Cost to tear down building $121000
Sale of Salvages ($8400)
Leagl fees $5340
Total $1,422,940
The cost of the land that should be recorded by Wilson Co. is: $1,422,940
cost of the building calculation
Architect's fees $47000
Insurance $3900
Liability insurance $4200
Excavation cost $15480
city for pavement $9900
Borrowing Costs $251000
Total $331,480
The cost of the building should be recorded by Wilson Co. is $331,480
You are analyzing two assets: collectible LEGO sets, and stock of Apple. In the last 5 years, LEGOs have had an annual volatility of 5%, annual return of 6%, and a CAPM beta (the correlation coefficient between the asset and the market risk-premium) of 1.6. Apple has had an annual volatility of 10%, an annual return of 8%, and a CAPM beta of 1.2. Is the following statement true or false?
According to CAPM, Apple has a higher expected return than LEGO.
Answer:
No, Apple has lower rate of return than LEGOs.
Explanation:
Risk free rate is 2% and Market risk is 9%
Expected return can be calculated by :
E(r) = Rf + beta * (Rm - Rf)
E(r) LEGOs = 2 + 1.6 * (9 - 2)
E(r) LEGOs = 13.2%
E(r) Apple = 2 + 1.2 * (9 - 2)
E(r) Apple = 10.4%
A foreign branch bank operates like a local bank, but legally Group of answer choices a branch bank is subject to only the banking regulations of its home country and not the country in which it operates. it is a part of the parent bank. a branch bank is subject to both the banking regulations of its home country and the country in which it operates. it is a part of the parent bank, and a branch bank is subject to both the banking regulations of its home country and the country in which it operates.
Answer:
Foreign branch
This is usually refered to as legal and operational section (part)of the parent bank. It is said that creditors of the branch have full legal rights on the bank's assets in all and also creditors of the parent bank have hold/claims on its branches' assets.
A foreign branch bank operates like a local bank, but is legally part of the the parent.
A branch bank is subject to both the banking regulations of home country and the country in which it operates (foreign country)
Explanation:
Foreign Branches
A foreign branch bank is a branch of a bank in other country. It usually operates like a local bank even though they are a section or part of the the parent legally. Thehy abide by the rules and regulations of the banking regulations of home country and also that of foreign country which their operating is based (branched)
They are commonly known to give a wide and broad range of services than a representative office. Branch Banks are used by U.S. banks to expand overseas.
Super Clinics offers one service that has the following annual cost and utilization estimates: Variable cost per visit $ 10 Annual direct fixed costs $50,000 Allocation of overhead costs $20,000 Expected utilization 1,000 visits What price per visit must be set if the clinic wants to make an annual profit of $10,000 on the service? A. $ 70 B. $ 80 C. $ 90 D. $100 E. $110
Answer:
C. $ 90
Explanation:
Number of visits = 1,000
Variable cost = $10 × 1,000 = $10,000
Fixed cost = $50,000
Overhead cost = $20,000
Required profit = $10,000
So,Total Cost = Variable Cost+ Fixed Cost+ Overhead Cost
= $10,000 + $50,000 + $20,000
= $80,000
Now, Price per Visit = (Total Cost+ Required Profit) ÷ Number of visits
= ($80,000 + $10,000) ÷ 1,000
= $90,000 ÷ 1,000
= $90
Game Theory and Strategic Choices -- End of Chapter Problem You have developed a new computer operating system and are considering whether you should enter the market and compete with Microsoft. Microsoft has the option of offering their operating system for a high price or a low price. Once Microsoft selects a price, you will decide whether you want to enter the market or not enter the market. If Microsoft charges a high price and you enter, Microsoft will earn $30 million and you will earn $10 million. If Microsoft charges a high price and you do not enter, Microsoft will earn $60 million and you will earn $0. If Microsoft charges a low price and you enter, Microsoft will earn $20 million and you will lose $5 million. If Microsoft charges a low price and you do not enter, Microsoft will earn $50 million and you will earn $0. Construct a payoff table and find the Nash equilibrium if you and Microsoft both make your decisions simultaneously.
In a simultaneous move game, Microsoft will and you will:___________
Answer:
Microsoft will choses High price and you will choose to enter the market .
Explanation:
The Nash equilibrium
You
enter Don't enter
Microsoft high price ( $30 , $10 ) ( $60 , $0 )
Microsoft low price ( $20, -$5 ) ( $50, $0 )
From the Nash equilibrium the best time for you to enter the market is when Microsoft Charges a high price
While the best time for Microsoft is when it charges a high price and you do not enter the market
But considering Simultaneous Move game : Microsoft will choses High price and you will choose to enter the market .
Here is the payoff table:
Enter Don't enter
High 30, 10 60,0
Low 20, -5 50, 0
In a simultaneous move game, Microsoft will charge a high price and you will enter the market.
Game theory studies how participants in a competitive market make the best choice for themselves.
Nash equilibrium is the best outcome for participants in a competitive market where no player has an incentive to change their decisions.
If I enter the market, I can either earn $10 million or lose $5 million. If I don't enter the market, I would earn nothing. The best strategy for me is to enter the market because $5 million is greater than 0.
If Microsoft charges a high price, it can either earn $30 million or $60 million. If the firm charges a low price, it would earn either $20 or $50 million. The best strategy is to charge a high price.
A similar question was answered here: https://brainly.com/question/14987529
Which of the following best describes the type of loss covered by the Spoilage Damage insuring agreement of the ISO Equipment Breakdown Protection Coverage Form? A. The spoilage of perishable goods resulting from breakdown of covered equipment. B. Costs to replace food labels resulting from breakdown of refrigeration equipment.
Answer:
A. The spoilage of perishable goods resulting from breakdown of covered equipment.
Explanation:
The ISO Equipment Breakdown Protection Coverage is used to compensate for losses that occur as a result of equipment breakdown. The cost covered by this type of insurance includes cost of repair of the equipment that failed along with the replacement not any property damaged as a result of equipment failure.
So when perishable goods get damaged because of breakdown of covered equipment, the ISO Equipment Breakdown Protection Coverage will cover for the loss
Southern Atlantic Distributors began operations in January 2021 and purchased a delivery truck for $40,000. Southern Atlantic plans to use straight-line depreciation over a four-year expected useful life for financial reporting purposes. For tax purposes, the deduction is 45% of cost in 2021, 30% in 2022, and 25% in 2023. Pretax accounting income for 2021 was $460,000, which includes interest revenue of $68,000 from municipal governmental bonds. The enacted tax rate is 25%.
Assuming no differences between accounting income and taxable income other than those described above:
Required:
1. Complete the following table given below and prepare the journal entry to record income taxes in 2021.
2. What is Southern Atlantic’s 2021 net income?
Answer:
1. Depreciation as per books = Cost of purchase/Useful life
Depreciation as per books = $40,000/4
Depreciation as per books = $10,000
Depreciation as per tax for 2021 = Cost of purchase * Deduction rate
Depreciation as per tax for 2021 = $40,000 * 45%
Depreciation as per tax for 2021 = $18,000
Temporary difference = $18,000 - $10,000
Temporary difference = $8,000
Particulars Amount Tax Rate Tax Recorded as
Pretax accounting income $460,000
Permanent difference -$68,000
Income subject to taxation $392.00 25% $98,000 Income tax expense
Temporary difference -$8,000 25% -$2,000 Deferred tax liability
Income taxable in $384,000 25% $96,000 Income tax payable
current year
Journal Entries - Southern Atlantic Distributors
Date Particulars and Explanation Debit Credit
Income tax expense $98,000
To Income taxes payable $96,000
To Deferred tax liability $2,000
(To record income tax expense)
2. Net income for 2021 = Pretax income - Income tax expense
Net income for 2021 = $460,000 - $98,000
Net income for 2021 = $362,000
A developing economy requires 1,000 hours of work to produce a television set and 10 hours of work to produce a bushel of corn. This economy has available a total of 1,000,000 hours of work per day.
Answer:
so what's your question
Are female expatriates different?.
Answer:
Explanation: Selmer and Leung (2003c) found that female expatriates have the same general adjustment as male expatriates, but with higher levels of work adjustment and better interaction adjustment. A replication study by Haslberger (2010) confirms that the adjustment patterns of male and female expatriates are different.
Answer:
yes the patterns of male and female expatriates are different
Locomotive Corporation is planning to repurchase part of its common stock by issuing corporate debt. As a result, the firm’s debt–equity ratio is expected to rise from 30 percent to 50 percent. The firm currently has $3.3 million worth of debt outstanding. The cost of this debt is 9 percent per year. Locomotive expects to have an EBIT of $1.32 million per year in perpetuity. Locomotive pays no taxes.
a. What is the market value of Locomotive Corporation before and after the repurchase announcement?
b. What is the expected return on the firm’s equity before the announcement of the stock repurchase plan?
c. What is the expected return on the equity of an otherwise identical all-equity firm?
d. What is the expected return on the firm’s equity after the announcement of the stock repurchase plan?
Answer: See explanation
Explanation:
a. What is the market value of Locomotive Corporation before and after the repurchase announcement?
Equity value = Debt value / Debt to equity ratio
= 3,300,000/0.3
= 11,000,000
Market value = Debt value + Equity value
= $3,300,000 + $11,000,000
= $14,300,000
b. What is the expected return on the firm’s equity before the announcement of the stock repurchase plan?
To solve this, we need to know the interest payment first which will be:
= $3,300,000 × 9%
= $3,300,000 × 0.09
= $297000
Return on equity will now be:
= (EBIT - interest) / Equity
= (1320000 - 297000) / 11000000
= 9.30%
c. What is the expected return on the equity of an otherwise identical all-equity firm?
This will be:
= Earnings before Interest / Unlevered firm value
= 1320000 / 14300000
= 9.23%
d. What is the expected return on the firm’s equity after the announcement of the stock repurchase plan?
This will be:
= 9.23% + 50% × (9.23% - 9%)
= 9.35%
Frieda Inc. is considering a capital expansion project. The initial investment of undertaking this project is $105,500. This expansion project will last for five years. The net operating cash flows from the expansion project at the end of year 1, 2, 3, 4 and 5 are estimated to be $22,500, $25,800, $33,000, $45,936 and $58,500 respectively. Frieda has a capital structure consisting of 20% debt and 80% equity. The after-tax cost of debt is 16% and the cost of equity is 18.5%.
What is Frieda%u2019s weighted average cost of capital?
a. 16%
b. 18%
c. 24%
d. 22%
Answer:
WACC = 0.18 or 18%
Option b is the correct answer.
Explanation:
The WACC or weighted average cost of capital is the cost of a firm's capital structure that can contain one or more of the following components, namely debt, preferred stock and common equity. The formula to calculate the WACC is as follows,
WACC = wD * rD * (1-tax rate) + wP * rP + wE * rE
Where,
w represents the weight of each component D, P and E represents debt, preferred stock and common equity respectively r represents the cost of each componentrD * (1-tax rate) represents the after tax cost of debt
WACC = 0.2 * 0.16 + 0.8 * 0.185
WACC = 0.18 or 18%
