When selecting the best alternative in a cost-benefit analysis, what are the issues to be considered?

Answers

Answer 1

Answer: Analyse cost, risk with impacts and project benefits.

Explanation:

The best alternative in a cost-benefit analysis situation are the following;

•The cost types should be analyzed

•Potential risk and their impacts should be looking into

•It is recommended to weigh all the risk even when there is a lot of project benefits.


Related Questions

Entries for Issuing Bonds and Amortizing Premium by Straight-Line Method Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, Year 1, Smiley issued $6,200,000 of 9-year, 9% bonds at a market (effective) interest rate of 6%, receiving cash of $7,479,078. Interest is payable semiannually on April 1 and October 1.

a. Journalize the entry to record the issuance of bonds on April 1, Year 1. If an amount box does not require an entry, leave it blank.

b. Journalize the entry to record the first interest payment on October 1, Year 1, and amortization of bond premium for six months, using the straight-line method. (Round to the nearest dollar.) For a compound transaction, if an amount box does not require an entry, leave it blank.

c. Why was the company able to issue the bonds for $20,811,010 rather than for the face amount of $20,000,000?

Answers

Answer:

All requirements are solved below

Explanation:

Requirement A: Entry to record the issuance of a bond on April 1 year 1

                                                     DEBIT           CREDIT

Entry

Cash                                       $7,479,078  

Bonds payable                                              $6,200,000  

Premium on Bonds payable                          $1,279,078

Requirement B: Entry to record the first interest payment on October 1 Year 1

                                                        DEBIT           CREDIT

Entry

interest expense                          $207940  

Premium on Bonds payable(w)    $71,060  

Cash(w)                                                                $279,000

Working

Cash = $6,200,000 x 9% x 6/12

Cash = 279000

Premium = ($1,279,078/9years ) x 6/12

Premium = $71,060

Requirement C: Why was the company able to issue the bonds for $7,479,078 rather than for the face amount of $6,200,000  

Answer: The company was able to issue the bonds for $7,479,078 rather than $6,200,000  because the market rate of interest is less than the contract rate of interest.

According to the lecture video on building dynamic charts, which of the following Excel functions are used in the "Refers to:" formula in Name Manager?
A) SUMIF
B) COUNTIF
C) OFFSET
D) COUNT

Answers

Answer:

OFFSET

COUNT

Explanation:

two options are correct, select both.

Answer:

Option C  and D are correct

Explanation:

OFFSET - From a cell or a range of cells, returns a reference to a range with a specified number of rows and columns.

COUNT - To determine the number of entries in a number field that is part of a range or array of values, use the COUNT function.

Busch Company has these obligations at December 31. For each obligation, indicate whether it should be classified as a current liability, long-term liability, or both. (a) A note payable for $100,000 due in 2 years. select a balance sheet section (b) A 10-year mortgage payable of $200,000 payable in ten $20,000 annual payments. select a balance sheet section (c) Interest payable of $15,000 on the mortgage. select a balance sheet section (d) Accounts payable of $60,000. select a balance sheet section

Answers

Answer:

Busch Company

Indication of whether the obligation be classified as a current liability, long-term liability, or both:

(a) A note payable for $100,000 due in 2 years. Long-term Liability

(b) A 10-year mortgage payable of $200,000 payable in ten $20,000 annual payments.   Both.

Every year, $20,000 would be classified as Current Liability while the remaining balance is long-term liabilities.

(c) Interest payable of $15,000 on the mortgage. Both

If the interest payable is to be settled at the end of the mortgage, then it is classified as only long-term.

(d) Accounts payable of $60,000. Current Liability

Explanation:

Busch's current liabilities are financial obligations that are due for settlement within the next accounting period of 12 months or less.

The long-term liabilities of Busch Company are those financial obligations that are not due for settlement within the next accounting period.

For some long-term liabilities, Busch may settle some part within 12 months.  That part that can be settled within the accounting period are classified as current while the other parts are non-current.

Explain how you would value a stock. Provide an example of a valuation of a stock based on retrieved real data. Include evidence of the retrieved data in your answer. Compare your valuation with the actual price of the stock at the designated time for your valuation.

Answers

Answer with Explanation:

There are numerous stock valuing models but here, I will use Dividend Valuation Model which is based on finding the intrinsic value of Stock which is the present value of the stock at a required rate of return. The formula to calculate Intrinsic value of stock is given as under:

P0= D0   *  (1 + g) / (ke - g)

Here

P0 is the intrinsic value of the stock

D0 is the dividend just paid

g is the growth rate

ke is the investor's required rate of return

The model doesn't holds if the company doesn't pays Dividend.

Now suppose that the Dividend just paid by Apple is $20 per stock. The anticipated growth rate of dividend is 10% and the required rate of return is at 15%.

By putting values in the above equation, we have:

P0= $20 * (1 + 10%) / (15% - 10%)

= $20 / (15% - 10%)

= $400 per share

The value of stock of Apple is $400 per share which must be its fair market value as per the Dividend Valuation Model.

As per the model, if the value of stock is higher as per dividend valuation model then we must purchase the stock as it will generate higher value and vice versa. The inherent limitation of the model is that it assumes that the dividend is growing at constant rate and is consistently paid. The main disadvantage of Dividend valuation model is that it doesn't account for political factors, economical factors, evolving business risks, technological factors, etc.

Kohler Corporation reports the following components of stockholders’ equity at December 31, 2018. Common stock—$10 par value, 100,000 shares authorized, 40,000 shares issued and outstanding $ 400,000 Paid-in capital in excess of par value, common stock 60,000 Retained earnings 460,000 Total stockholders' equity $ 920,000 During 2019, the following transactions affected its stockholders’ equity accounts. Jan. 2 Purchased 4,500 shares of its own stock at $25 cash per share. Jan. 5 Directors declared a $2 per share cash dividend payable on February 28 to the February 5 stockholders of record. Feb. 28 Paid the dividend declared on January 5. July 6 Sold 1,688 of its treasury shares at $29 cash per share. Required: 1. Prepare journal entries to record each of these transactions.

Answers

Answer:

Kohler Corporation

Journal Entries:

Jan. 2:

Debit Treasury Stock $45,000

Debit Paid-in Capital In Excess of Par $67,500

Credit Cash Account $112,500

To record the purchase of 4,500 shares of its own stock at $25 per share.

Jan. 5:

Debit Dividends $71,000

Credit Dividends Payable $71,000

To record the declaration of $2 per share cash dividend.

Feb. 28:

Debit Dividends Payable $71,000

Credit Cash Account $71,000

To record the payment of cash dividend on 35,500 shares at $2 per share.

July 6:

Debit Cash Account $48,952

Credit Treasury Stock $16,880

Credit Paid-in Capital In Excess of Par $32,072

To record the sale of treasury stock shares at $29 per share.

Explanation:

a) Data and Calculations:

Common stock—$10 par value, 100,000 shares authorized,

40,000 shares issued and outstanding $ 400,000

Paid-in capital in excess of par value,

common stock                                             60,000

Retained earnings                                      460,000

Total stockholders' equity                      $ 920,000

b) The purchase on Jan. 2 of its own stock of 4,500 shares, the cash receipt is credited to the Cash Account while the Treasury Stock is debited, but only with the par value of the repurchased shares if the par value method is adopted.  If the costing method is adopted, the value to be debited to the Treasury Stock account would have $112,500 without any debit to the Paid-in Capital In Excess of Par.  This is also followed when the sale of 1,688 treasury shares at $29 per share takes place on July 6, but with opposite entries.

c) To compute the dividend payable, the treasury stock shares of 4,500 are deducted from the outstanding shares of 40,000.  This means that the shareholders of record have shares outstanding totalling 35,500 (40,000 - 4,500).

d) The general journal is used in these cases to record the transactions initially in the books of Kohler Corporation.  They show the accounts to be debited and the others to be credited, since two accounts or more are usually involved in any business transaction.

Kenneth Arrow discussed two important situations in which profit maximization can be socially inefficient. One of these occurs when

Answers

Answer:

Explanation:

One of these occurs when costs are not paid for, as in pollution, the other is when there is an imbalance of knowledge between buyer and seller. Pollution  can be a consequence that cannot be solved with money and can also be socially irresponsible for a company. On the other hand, an imbalance of knowledge can prevent a company from profit maximization if the seller does not understand the product or services that the buyer is selling.

Airborne Airlines Inc. has a $1,000 par value bond outstanding with 10 years to maturity. The bond carries an annual interest payment of $90 and is currently selling for $960. Airborne is in a 20 percent tax bracket. The firm wishes to know what the aftertax cost of a new bond issue is likely to be. The yield to maturity on the new issue will be the same as the yield to maturity on the old issue because the risk and maturity date will be similar.

Required:
a. Compute the yield to maturity on the old issue and use this as the yield for the new issue.
b. Make the appropriate tax adjustment to determine the aftertax cost of debt.

Answers

Answer:Yield to maturity is 9.59%;  After tax cost of debt =7.672%

Explanation:

 A)   Yield to maturity ={ C + (FV-PV)/t} /  {(FV +PV)/2}

Where C – Interest payment    = $90

FV – Face value of the security

= $1000

PV – Present value/curent market value = $960

t – years it takes the security to reach maturity= 10 years

imputing the values and calculating,

yield to maturity ={ C + (FV-PV)/t} /  {(FV +PV)/2}

= $90 + (1000-960)/10} / 1000 + 960 /2

$90 + 4= $94 /980= 0.0959

therefore Yield to maturity is 9.59%

B)   After tax cost of debt =    Yield To Maturity  x (1 - tax rate)

=9.59% x (1-20%)= 9.59% x (1-0.2 )= 9.59% x 0.8 =

9.59 % x 80%=7.672%

Kathy fields wants to buy a condominium selling for $95,000. The bank is requiring 20% down and is charging 9.5% interest for a 25 year loan. determine the amount required down payment and the amount of the monthly payment for the principal and interest.

Answers

Answer:

The down payment is 19000 and monthly payment is 664.009

Explanation:

The purchase price of condominium = $95000

Down payment = 20%

Interest charged  = 9.5 %

Time period = 25 years

Down payment amount =  95000 × 20% = 19000

Remaining loan amount = $76000

Below is the calculation of monthly payment:

[tex]\text{Present vlaue of annuity} =\frac{A(1-(1+r)^{-n})}{r} \\A = monthy \ installment \\76000 = \frac{A(1-(1+ 0.095/12)^{-25\times 12})}{ 0.095/12} \\A(0.906112) = 601.667 \\A = 664.009[/tex]

The Asian Garden​, a local Thai​ restaurant, expects sales to be $ 285,000 in January. Its average customer restaurant bill is $ 15. Only 20 % of the restaurant bills are paid with​ cash; 60 % are paid with credit cards and 20 % with debit cards. The transaction fees charged by the credit and debit card issuers are as​ follows:Credit​ cards: $0.60 per transaction​ + 2 % of the amount chargedDebit​ cards: $0.55 per transaction​ + 1% of the amount chargedRequried:a. How much of the total sales revenue is expected to be paid in​cash?b. How many customer transactions does the company expect in​January?c. How much of the total sales revenue is expected to be paid with credit​ cards?d. How many customer transactions will be paid for by customers using credit​cards?e. When budgeting for​ January's operating​ expenses, how much should the restaurant expect to incur in credit card transaction​fees?f. How much of the total sales revenue is expected to be paid with debit​ cards?g. How many customer transactions will be paid for by customers using debit​cards?h. When budgeting for​ January's operating​ expenses, how much should the restaurant expect to incur in debit card transaction​fees?i. How much money will be deposited in the​ restaurant's bank account during the month of January related to credit and debit card​ sales? Assume the credit and debit card issuers deposit the funds on the same day the transactions occur at the restaurant​(there is no processing​ delay).j. What is the total amount of money that the restaurant expects to deposit in its bank account during the month of January from​ cash, credit​ card, and debit card​ sales? Again assume the credit and debit card issuers deposit the funds on the same day that the transaction occurs.

Answers

Answer:

a. How much of the total sales revenue is expected to be paid in​cash?

$855,000

b. How many customer transactions does the company expect in​January?

19,000

c. How much of the total sales revenue is expected to be paid with credit​ cards?

$171,000

d. How many customer transactions will be paid for by customers using credit​cards?

11,400

e. When budgeting for​ January's operating​ expenses, how much should the restaurant expect to incur in credit card transaction​fees?

$10,260

f. How much of the total sales revenue is expected to be paid with debit​ cards?

$57,000

g. How many customer transactions will be paid for by customers using debit​cards?

3,800

h. When budgeting for​ January's operating​ expenses, how much should the restaurant expect to incur in debit card transaction​fees?

$2,660

i. How much money will be deposited in the​ restaurant's bank account during the month of January related to credit and debit card​ sales? Assume the credit and debit card issuers deposit the funds on the same day the transactions occur at the restaurant​(there is no processing​ delay).

$215,080

j. What is the total amount of money that the restaurant expects to deposit in its bank account during the month of January from​ cash, credit​ card, and debit card​ sales? Again assume the credit and debit card issuers deposit the funds on the same day that the transaction occurs.

$272,080

Explanation:

total sales $285,000 / $15 = 19,000 customers

cash sales = $285,000 x 20%  = $57,000credit cards = $285,000 x 60%  = $171,000debit cards = $285,000 x 20%  = $57,000

credit card fees = (11,400 x $0.60) + ($171,000 x 2%) = $10,260

debit card fees = (3,800 x $0.55) + ($57,000 x 1%) = $2,660

Your grandfather has great faith in bonds and has heard about some "high yield bonds" that are available. He has asked you for your opinion. What advice will you give him?

Answers

Answer: That they are risky

Explanation:

Bonds tend to give a low return compared to other investments such as stocks which is because they offer a constant payout. However even with bonds there will still be those that promise a higher return than the others and this is because they are riskier.

Bonds are debt instruments which means that the rate they pay is directly related to the risk attached. This is because the interest payment is meant to compensate you for the risk you are taking by getting that bond.

If the yield/return is high it would therefore follow that the risk Is high as well. Your Grandfather should therefore be aware of this risk before investing because riskier bonds might not pay back.

Though not specifically cited in the producer's contract, the producer is expected to telephone prospects on the insurer's behalf to arrange sales appointments. This is an example of what kind of producer authority?

Answers

Answer:

Implied authority

Explanation:

Implied authority defines an authority with respect to agent that involves jurisdiction to perform the acts so that the objectives of the organization could be achieved. Also, it is a binding contract on other person behalf or company

Therefore according to the given situation, this is an example of implied authority

Currently Baldwin is paying a dividend of $1.10 (per share). If this dividend stayed the same, but the stock price rose by 10% what would be the dividend yield

Answers

Answer:

Dividend yield = 227.06%

Explanation:

Assuming the Closing stock market summary for Baldwin company is $44.05

Dividend yield = Dividend * 100 / (Price* (1 + growth rate) )

Dividend yield = 1.10 * 100 / (44.05 * (1+0.10) )

Dividend yield = 1.10 * 100 / (44.05 * 1.10)

Dividend yield = 110 / 48.455

Dividend yield = 2.2706

Dividend yield = 227.06%

Marigold Corp. issues $220,000, 20-year, 8% bonds at 104. Prepare the journal entry to record the sale of these bonds on June 1, 2020

Answers

Answer:

Selling Price of Bonds = Value of bonds * Issue price / Face price

Selling Price of Bonds = $220,000 * 104/100

Selling Price of Bonds = $228,800

                                   Journal Entry

Date        Account Title and Explanation        Debit       Credit

1 June      Cash                                                $228,800  

                         Bond payable                                           $220,000

                         Premium on bond payable                       $8,800

                (To record issuance of bond)

Working

Premium On Bonds Payable = Selling Price of Bonds - Value of Bonds

= $228,800 - $220,000

= $8,800

A three-year annuity-immediate will be issued a year from now with annual payments of 5,000. Using the forward rates, calculate the present value of this annuity a year from now.

Answers

Answer:

13,152.5

Explanation:

Given the the above parameters as mentioned in the question

To calculate the PV (Present Value)

We have PV = 5000 * 1.05 * [ 1/(1.0575)² + 1/(0.625)³ + 1/(1.065)⁴]

PV = 5000 * 1.05 * (0.8942094350 + 0.8337064929 + 0.7773230908) =

=> PV = 5000 * 1.05 * 2.5052390187

= 13,152.50

Therefore, in this case, using the forward rates, the present value of this annuity a year from now is 13,152.50

Anna hired Juan to act as her sales agent in her auto dealership. However, Anna has instructed Juan not to enter into any sales contracts before she has had a chance to review the transaction. One day, Juan entered into a sales contract with William without informing Anna first. Has Juan created a contract with William that is binding on Anna in this situation?

Answers

Answer:

Yes, Juan did have apparent authority to act.

Explanation:

In the situation that is being described it can be said that Yes, Juan did have apparent authority to act. Even though Anna has asked Juan to let her review the transaction before entering into a contract, she gave Juan the authority to act on her behalf and represent her as an authority in the auto dealership when she made him a sales agent. Therefore any and all contracts entered by Juan in the dealership are binding on Anna as well.

Where can you go in the Banking Center to review downloaded bank feed transactions that have already been matched to existing transactions in QuickBooks Online?a. For Review tabb. Reviewed tabc. Recognized tab d. Excluded tab

Answers

Answer:

Where can you go in the Banking Center to review downloaded bank feed transactions that have already been matched to existing transactions in QuickBooks Online?

a. For Reviewed tab

Explanation:

In QuickBooks online, you have the Reviewed tab where you can download at least the last 90 days of transactions, made with your bank or credit card. QuickBooks is also able to categorize all the downloaded transactions you have done. In the reviewed tab you can find all the accepted bank transactions.

Sally Eason put $4,000 in her deductible IRA this year. If Sally is in the 25 percent marginal tax bracket, the government actually contributed ____ of that amount for her. Group of answer choices

Answers

Answer: $1000

Explanation:

From the question, we are informed that Sally Eason put $4,000 in her deductible IRA this year and that Sally is in the 25 percent marginal tax bracket.

Based on the above information, the government contributed:

= 25% × $4,000

= 25/100 × $4,000

= 0.25 × $4,000

= $1000

The Retained earnings account for Nathan Corporation had a credit balance of $800,000 at the end of 2016. Selected transactions during 2017 follow:

a. Net income was $130,000.
b. Cash dividends declared were $60,000
c. Repurchased 100 shares of Nathan Corporation common stock, paying S20 per share. Each share has a $5 par value and was originally issued for $35.
d. Sold 20 shares of Nathan Corporation common stock for $22 each.

Required:
Calculate Nathan's retained earnings balance as of the end of 2011. How large of a dividend could Nathan have declared in 2011?

Answers

Answer:

1 & 2. $870,000

Explanation:

1. Retained Earnings is an equity account from which dividends are paid. The Net Income is added to this and the dividends are deducted from this.

Retained Earnings for the year = Beginning balance + Net Income - Dividends

= 800,000 + 130,000 - 60,000

= $870,000

2. Nathan Corporation could have declared the entire retained earnings of $870,000. This is however, not a recommended action because the Retained Earnings maintain a cushion for the company and as such contribute to financial health and structure of the company.

15. Karla Salons leased equipment from Smith Co. on July 1, 2021, in a finance lease. The present value of the lease payments discounted at 10% was $81,100. Ten annual lease payments of $12,000 are due each year beginning July 1, 2021. Smith Co. had constructed the equipment recently for $66,000, and its retail fair value was $81,100. What amount of interest revenue from the lease should Smith Co. report in its December 31, 2021, income statement

Answers

Answer: $3,455

Explanation:

The interest received by Smith can be calculated as;

Interest Value = Present value of lease payment * interest rate

Present Value of interest rate

Ten annual lease payments of $12,000 are due each year beginning July 1, 2021.

That means first payment has been made already. Present value is;

= 81,100 - 12,000

= $69,100

Only half a year has gone by so this will need to be reflected;

Interest Value = Present value of lease payment * interest rate

= 69,100 * 10% * 6/12

= $3,455

g The company plans a 4-for-1 stock split. How many shares will you own and what will the share price be after the stock split?

Answers

Answer: 14,400; $17

Explanation:

Stock splits are a strategy by firms to increase the liquidity of their shares especially when they are trading at a high price. The firm divides the stock by a certain number thus increasing the number of shares by the multiple of the number. This action will divide the price of the stock and thus allow for more trade as they are cheaper.

A 4-for- stock split means that each share will become 4.

Your total number of share will become;

= 4 * 3,600

= 14,400 shares

The new price will be;

= 68/4

= $17 per share

Discuss three major factors that contribute to an employee's decision to join a union. Discuss the five reasons that have contributed to the trend of decline in unionization g

Answers

Answer:

The answer is below

Explanation:

Three major factors that contribute to an employee's decision to join a union.

1. Greater Bargaining Power

As an individual employee, it can be difficult to negotiate for wage increase or better working condition generally. However, being a member Union, together the group can negotiate and demand for what they feel is right for their members. In a rare occasion, the threat of a strike by a Union is a great tool to bargain well with the employer.

2. Minimize Discrimination

As a Union, it is easier to demand for equality in terms of wage, working condition, promotion, leave etc. Unlike individual employee, who may be facing discrimination from his or her supervisor as to employee related issue. Union can ensure the management used the right policies that seek for equality among all its employees without favoritism or discrimination.

3. Sense of Security

An employee may join the Union on the basis that, Union can save them against abrupt dismissal or other types of work insecurities including accident, injury, illness etc.

Also, Union can help secure retirement benefits and ensure the management improve on the employees' welfare generally.

Five reasons that have contributed to the trend of decline in unionization

1. Irrelevance appearance of the Union:

Many workers believe that Union is not necessary because in the time of economic boom, getting wage increase and other working benefits can be gotten be individual employee and not necessarily through a Union, and at the same time, during economic downturn, unions often times don't have the capacity to protect their members from layoffs, wage and benefit reductions and tougher working conditions.

2. Poor Image of the Union:

Many employers and employees tend to view union with negativity, in the sense that, often times, their demands can be unreasonable, and are characterized by issue of labor racketeering, mob influence and embezzlement.

3. Unions are Seen as Political:

For some employees, they believe that Union tend to use their money or Union dues to support a political candidate. This in turn has made some employees who are neutral, not wanting to join the Union.

4. Reliance on goverment:

Many employees now believe that, government, not Union gives better form of security and voice to air their opinions. These includes pensions, healthcare, protection.

5. Global competition and deregulation in Unionized industries:

Since most of the companies or industries that have union has been deregulated, this has increased its competition, there by, making the need for union not really necessary, because with or without Union, one may still faces sack.

f the nominal interest rate is 7 percent and the real interest rate "is -2.5" percent, then the inflation rate is

Answers

Answer:

9.7%

Explanation:

(1 + nominal interest rate) = (1 + real rate) x (1 + inflation rate)

1.07 = 0.975 x (1 + inflation rate)

(1 + inflation rate) = 1.07 / 0.975

(1 + inflation rate) = 1.097

Inflation rate = 1.097 - 1 = 0.097 = 9.7%

Buster Evans is considering investing $20,000 in a project with the following annual cash revenues and expenses: Cash Cash Revenues Expenses Year 1 $ 8,000 $ 8,000 Year 2 $12,000 $ 8,000 Year 3 $15,000 $ 9,000 Year 4 $20,000 $10,000 Year 5 $20,000 $10,000 Depreciation will be $4,000 per year. What is the accounting rate of return on the investment

Answers

Answer:

Accounting rate of return= 20%

Explanation:

The accounting rate of return is the average annual income expressed as a percentage of the average investment.  

The simple rate of return can be calculated using the two formula below:  

Accounting rate of return  

= Annual operating income/Average investment × 100  

Average investment = (Initial cost + scrap value)/2  

Average profit = Total profit over investment period / Number of years

Total revenue = 8000+12000+ 15000 + 20,000+ 20,000 = 75000

Total expenses= 8000 + 8000 + 9000 +10,000 + 10,000 = 45000

Cash profit = 75,000 - 45,000 = 30,000

Depreciation = 4000× 5 = 20,000

Accounting profit = Cash profit - Depreciation = 30,000- 20,000 = 10,000

Average profit = 10,000/5 = 2,000

Accounting rate of return = 2,000/20000× 100 = 20%

Accounting rate of return= 20%

Piper's Pizza sold baking equipment for $25,000. The equipment was originally purchased for $72,000, and depreciation through the date of sale totaled $51,000. What was the gain or loss on the sale of the equipment?
Sale amount
Less:
Cost of the baking equipment
Book value

Answers

Answer:

$4,000 gain

Explanation:

The calculation of gain or loss on the sale of the equipment is shown below:-

Gain or loss on the sale of the equipment = Sales - Cost of the baking equipment - Accumulated Depreciation

= $25,000 - ($72,000 - $51,000)

= $25,000 - $21,000

= $4,000

Therefore for computing the gain or sale we simply applied the above formula.

Fresh Veggies, Inc. (FVI), purchases land and a warehouse for $410,000. In addition to the purchase price, FVI makes the following expenditures related to the acquisition: broker's commission, $21,000; title insurance, $1,100; and miscellaneous closing costs, $4,200. The warehouse is immediately demolished at a cost of $21,000 in anticipation of building a new warehouse. Determine the amount FVI should record as the cost of the land.

Answers

Answer:

$457,300

Explanation:

FVI purchased a land and warehouse at the cost of $410,000

The following expenditures were incurred

Broker's commission = $21,000

Title insurance= $1,100

Miscellaneous closing costs= $4,200

Demolition of the warehouse= $21,000

Therefore, the amount in which FVI should record as cost of the land can be calculated as follows

=$410,000+$21,000+$1,100+$4,200+$21,000

= $457,300

Hence the amount that FVI should record as the cost of the land is $457,300

the annual discount rate is 10% beginning in 2016, you will receive $10000 on the first day of every year. what is the resent value of this inginite sequence of cash flow

Answers

Answer:

$100,000

Explanation:

Data provided

Perpetual cash flow = $10,000

Discount rate = 10%

According to the given situation, the computation of Present value of this inginite sequence of cash flow is shown below:-

Present value = Perpetual cash flow ÷ discount rate

= $10,000 ÷ 10%

= $10,000 ÷ 0.1

= $100,000

Therefore for computing the present value we simply applied the above formula.

Use information from the Washington Post article "Why We've Been Hugely Underestimating the Overfishing of the Oceans" to determine whether each statement is true or false.

a. According to the Food and Agriculture Organization of the United Nations (FAO), worldwide catches peaked in 2001 at 86 million tons.
b. Using catch reconstruction, researchers estimate that the actual peak catch was 50% larger than the reported peak catch.
c, Catch reconstruction shows that, since the peak, catches have been increasing, not decreasing as previously reported.
d. The Sea Around Us Project found several problems with the FAO data, such as the fact that data that were not available were reported as catches of zero fish.

Answers

Answer:

"Why We've Been Hugely Underestimating the Overfishing of the Oceans"

Determining whether each statement is true or false:

a. False

b. True

c. False

d. True

Explanation:

The article "Why We've Been Hugely Underestimating the Overfishing of the Oceans," was published by the Washington Post on January 19, 2016.  It was written by Chelsea Harvey.  It tried to show how the world fish stock had been declining due to overfishing.  This is why it provided a report contrary to the FAO report.  

While the FAO report noted that the peak of worldwide catches was at 86 million tons in 1996, the contrary and independent report, using "catch reconstruction" showed that the peak was at 130 million tons in 1996.  The reconstructed research also showed that worldwide fish catches had suffered declines ever since the 1996 peak, thereby threatening "world food security and marine ecosystems".  The contrary report also suggested that all stakeholders must collaborate so that fish stocks can rebuild naturally.

In its most recent annual report, Appalachian Beverages reported current assets of $70,300 and a current ratio of 1.90. Assume that the following transactions were completed:_________.
(1) purchased merchandise for $6,700 on account and (2) purchased a delivery truck for $10,000, paying $2,000 cash and signing a two-year promissory note for the balance.
Compute the updated current ratio (round answers to 2 decimal places)Transaction (1) ________________Transaction (2) ________________I am not sure how to do this problem, I understand how to general compute the current ration:________.Current raion= currenct assets/current liabilitiesbut how do you do compute an update?If someone could show me how to do this correctly, I will award them lifesaver.

Answers

Answer:

Appalachian Beverages

With reported current assets of $70,300 and a current ratio of 1.90, one can work out the current liabilities from these two.  The current liabilities are equal to $70,300/1.90 - $37,000.  To work back, one can state that current ratio equals $70,300/$37,000 = 1.90.

Having ascertained the value of the former current liabilities, one can use the information to update the two parameters for calculating the current ratio as follows:

Current liabilities increased by $6,700 from purchase of merchandise on account and of a delivery truck by $8,000.  So, the updated current liabilities equal to $37,000 + 6,700 + 8,000 = $51,700.  Similarly, the current assets decreased by $2,000 for the part-payment for the delivery truck.  Thus, current assets are now equal to $68,300 ($70,300 - 2,000).

Having updated the two parameters, one can then compute the updated current ratio as follows:

Current ratio = current assets/current liabilities = $68,300/$51,700 = 1.32.

Explanation:

Appalachian Beverages' current ratio shows the relationship between current assets and current liabilities and the ability of the entity to settle current liabilities with current assets.

If D​ = 8,200 per​ month, S​ = ​$44 per​ order, and H​ = ​$2.00 per unit per​ month, ​a) What is the economic order​ quantity? The EOQ is 601601 units ​(round your response to the nearest whole​ number). ​b) How does your answer change if the holding cost​ doubles? The EOQ is 425425 units ​(round your response to the nearest whole​ number). ​c) What if the holding cost drops in​ half? The EOQ is nothing units ​(round your response to the nearest whole​ number).

Answers

Answer: A) The Economic Order Quantity is 601 units.  

B)The Economic Order Quantity is 425 units.

C )The Economic Order Quantity is 849 units

Explanation:

EOQ, economic order​ quantity = [tex]\sqrt{ 2 x Dx S/ H}[/tex]

where D=  demand

S = Order cost

H= holding cost.

a)when  D​ = 8,200 per​ month, S​ = ​$44 per​ order, and H​ = ​$2.00

EOQ, economic order​ quantity = [tex]\sqrt{2x D x S /H}[/tex]

=  [tex]\sqrt{2 x 8,200 x 44 /2 }[/tex] =  [tex]\sqrt{360,800}[/tex] = 600.666= 601 units

b) if the holding cost​ doubles, holding cost = HX 2 = 2 X 2  = 4

EOQ, economic order​ quantity =[tex]\sqrt{ 2 x D xS /H }[/tex]

= [tex]\sqrt{2 X 8,200 X 44 / 2 X $2}[/tex] = [tex]\sqrt{180,400}[/tex] = 424.73 = 425units

C) if the holding cost drops in​ half, holding cost = H/2 = 2 X 1/2 = 1

EOQ, economic order​ quantity =[tex]\sqrt{ 2 x D xS /H }[/tex]

= [tex]\sqrt{2 X 8200 x 44/1}[/tex] = [tex]\sqrt{721,600}[/tex] = 849.47 = 849units

A firm has current assets of $36,000, cash of $5,000, current liabilities of $20,000, total assets of $80,000 and total liabilities of $45,000. What is its net working capital?
a. $16,000
b. $28,000
c. $35,000
d. $44,000

Answers

Answer:

Option A, $16000, is the right answer.

Explanation:

The current assets = $36000

Cash = $5000

Current liabilities = $20000

Total assets = $80000

Total liabilities  = $45000

Use the below formula to find the net working capial.

Net working capital = Current assets - Current Liabilities

Net working capital = 36000 – 20000

Net working capital = 16000

Therefore, option A, $16000 is correct.

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